Credit union issues strong message to customers

Despite the slowdown in such activity, refinancing is still a viable option for novel uses, Lindquist suggested. “People can tend to be very impulsive,” she told MPA. “I know I’m a very impulsive person and just go and buy. But home equities are great because right now home values are really high up there. I’m sure, eventually, they will start to go down, but your home is your best asset you have – so being able to use the equity you have in your home for emergencies, a catastrophe that may happen down the road or financial debt.”

She’s noticed less equity being used for renovations as was seen during the peak of the refinancing boom. “We’ve had a lot of people recently using it for debt consolidation,” she said. “I had someone recently that had probably over $60,000 in credit card debt, and he had tons of equity in his home. So we pulled the equity out and paid all these cards off and he’s saving over $1,200 a month just in payments.”

Read more: Refinanceable population has hit a record high, says Black Knight

Which isn’t to say refinancing can’t be used for fun stuff – particularly important for the sake of mental well-being after what seemed an interminable period of pandemic forcing physical distancing and disproportionate hours staying indoors at home. “Getting toys,” she said, ticking off a list of such purchases. “They’re using them even for boats because they can get the payment like they wanted. Vacations – I had someone taking their kids to Hawaii. They want to be able to do everything but not pull everything from their savings account.”

There is a wide array of projects to finance through refinancing, and some states do monitor its uses. But in the Washington area where iQCU has a large presence, she said no such checks exist. “At the beginning, we asked what they used their funds for,” Lundquist said. “Some states require contracts, invoices. But in Washington state, we don’t monitor it.”

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