I’ll find out, but I have a feeling it’s offered on higher levels… For example, I wouldn’t be surprised if Wells Fargo private bank has some deal like that..
It’s probably for folks with several million in assets who, even if it takes a hit, wouldn’t matter overall to the loan amount and who don’t want to cash out but rather borrow against it…In other words, probably a rich’s people’s game… Probably not for folks below a threshold (and that’s inclusive)…
Banks aren’t stupid…. And futhermore, doubt it’s done against IRA’s, since IRA’s have BK exclusions, if I recall.[/quote]
Ah..yeah that makes sense if this is who it’s geared towards but that article didn’t make it sound like that.
I can see if someone has all cash there isn’t risk to the bank if the bank is preventing the account holder from tapping that cash. But I can see some scenarios of someone that is pledging 75% stock portfolios having some problems depending on what their portfolio is made up of.
I think this go around, banks and financial institutions will limit their downside exposure but I can see some scenarios where it might not end up too well for the borrower.
Absolutely if you have responsible people that use it the right way it can make sense. But anytime you allow 100% leverage for “arbitrage” reasons, investors can easily find ways to screw themselves.
Still it’s interesting they are coming out with products like these. As if the market wasn’t getting tough enough with inventory issues with hedge funds and funds snapping up properties.
