Financial Pros Answer Your Top Questions

Q: I'm a homeowner. I need money, and I want to take out a home equity loan. Is that even possible today? How hard is it to get any kind of loan?

Levin: "Borrowing against your home equity requires three things: a good credit score, sufficient demonstrable income to support the new loan and all your other credit obligations and, most importantly, meaningful equity in your home. Lenders still are writing home equity loans and lines of credit but the least costly loans will require no less than 30 percent equity in your home after the new loan. Your best bet will be a local credit union or bank that is familiar with property values in your area."

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Engle: "It is possible, but maybe not advisable at this moment. Ask yourself, 'Do I need money, or do I want money?' It looks like the Fed is about to lower interest rates again. If you can wait a few months, you should have no trouble getting a loan if you have good credit, and a valid use for the money."

Hutchins: "It is harder to get a loan today than it was yesterday; and absent effective action on the part of Congress and the administration, it will be even more difficult tomorrow. Whether you have good or bad credit, and lots of or little equity in your home, there is simply little money out there available to be borrowed. Most banks act primarily as brokers for loans: They make the loan, then immediately sell it to bigger banks, insurance companies and other institutional investors (you know, those firms that you have been reading about going bankrupt, being bailed out by the government or being absorbed at fire sale prices by other teetering financial institutions). All of this is changing day to day, so go to your local community bank and apply. You might have even better luck at a credit union if you belong to one. The acuteness of the problem is likely to subside, but the availability of credit is unlikely to return to levels anywhere near what it was prior to the current crisis."

Johnston: "I recently contacted a credit union and they tell me their standards for approving loans have not changed at all. They are still doing home equity loans. In my opinion, a home equity loan is a great vehicle to have as an emergency asset. However, I strongly recommend not using it unless you absolutely have to."