Ohio Home Equity Loans

Banks' inequity in home-equity loans

Picture this nightmare financial scenario: You’ve taken out a $150,000 home-equity credit line to remodel your house. You’ve already pulled out thousands to pay contractors and owe thousands more, when suddenly you get a curt letter from the bank.

“Effective yesterday,” it says, “we’ve shut down access to your credit line. Although we haven’t physically appraised your property, an automated valuation indicates that it is now worth significantly less than it was when we approved your application. If you wish to hire an appraiser, chosen by us but at your own expense, you can appeal our decision.”

You’re in shock. You can’t pay bills for work you’ve contracted, and you can’t touch the money you confidently thought you had. Plus, you know that housing prices in your area have been relatively stable since you took out the credit line. How could a bank effectively devalue your real estate using nothing more than a computer program?

Welcome to the world of what class-action lawyers estimate to be massive numbers of homeowners — 1 million customers at one national bank alone — who had their credit lines reduced, frozen or canceled without appraisals during 2009 in the tense months following the near-collapse of the capital marketplace.

Now a federal district court in Chicago has given the green light to clients of JPMorgan Chase to proceed with a consolidated lawsuit alleging that their equity lines were yanked or reduced illegally, costing them billions of dollars in lost borrowing power. Judge Rebecca Pallmeyer rejected the bank’s motion to dismiss the case, clearing the way for a possible giant class action.

The litigation pulls together eight suits seeking class certification filed by homeowners in Arizona, California, Illinois, Minnesota, Ohio and Texas. It is considered a bellwether test of the rights homeowners have under the Truth in Lending Act and state consumer protection statutes when they take out equity lines of credit.

It also shines light on the controversial computerized tools many lenders use to make quick, inexpensive assessments of property values in lieu of more costly professional appraisals. Suits on similar grounds are pending against other major lenders, including Wells Fargo, GMAC Mortgage and Citibank, lawyers said.

The plaintiffs’ attorneys are challenging JPMorgan Chase’s legal right to rescind or limit credit lines without adequate documentation that property values have dropped “significantly,” required by the truth-in-lending law. They also are mounting a side attack against automated valuation models (AVMs) that they say are frequently inaccurate and unreliable.

Home Equity Loan Special - Ohio Catholic Federal Credit Union

- Low minimum payments 

*APR is Annual Percentage Rate. The Annual Percentage Rate is the advertised rate and can vary based on creditworthiness.  Promotional rates are available August 4, 2011, to August 9, 2011.  Loan term up to 10 years.  Minimum $20,000 loan amount required and $200,000 maximum loan amount available.  Loan must close by August 20, 2011.  Home Equity Loans or Second Mortgage Loans currently financed through Ohio Catholic cannot be refinanced with this offer.  This offer is available only on owner occupied homes.  Property insurance required.  Flood insurance may be required.  If you respond to this offer but do not meet the criteria for the loan at the time of your application or if you do not provide the required collateral, we may not be able to extend credit to you.  Ohio Catholic Federal Credit Union may discontinue or change program without notice. Payment examples: loan amount of $50,000 at 3.99% (4.01% APR with $50 loan documentation fee) for 120 months would have a monthly payment of $506.49.