CNN: How to deal with the lending crunch

[Aggie Hoopsfan]

* Reverse mortgages for older citizens

* 401k loans

* If you have CDs, etc. break those, pay the penalty fees, and you'll have cash


It's this kind of sound financial advice that helped put us in this situation...

[Extra Stout]

Dear citizens,

Apparently you have finally run out of blood after years of our sucking it from you. We are still hungry. Let us show you how to break your own bones so we can suck out the marrow.

Best regards,
The Mgt.

[ChumpDumper]

Did they mention not spending so much got damn money?

[baseline bum]

I would tell them to put money in Miller and Budweiser, because Americans are going to need a lot of their products after swallowing this bailout.

[1369]

Did they mention not spending so much got damn money?

*Gasp*

Blasphemer! Didn't you know it's in the consitiution that every American has the right to a McMansion and a 52" plasma, and HD satellite and a cell phone with unlimited texting and DSL?

The $10K available credit line was fought for and won for us by the Founders.

[bobbyjoe]

* Reverse mortgages for older citizens

* 401k loans

* If you have CDs, etc. break those, pay the penalty fees, and you'll have cash


It's this kind of sound financial advice that helped put us in this situation...

Reverse mortgages are a great option for many older Americans.

Reverse mortgages also can help bridge the gap between retirement needs of older Americans and retirement funds.

When Social security dies down the road, reverse mortgages will be a boon and potentially life-saver for many Americans who otherwise would be in a bind since they hadn't saved enough to sustain a decent standard of living and SS won't be around to help.

Another side benefit of reverse mortgages is that if the grip of the estate tax is strengthened (as it will in an Obama presidency), a lot of the benefit of passing a home own to one's heirs could be lost due to insane levels of marginal taxation per the estate tax.

They are underutilized if anything. A lot of Americans don't even know what they are and how they can potentially benefit. They have nothing to do with the mess we're in right now.

The problems that sprung the US into this mess can't be blamed on any specific policy or company. It's the entire American culture of overborrowing, overconsuming, and undersaving.

[Wild Cobra]

I agree with Bobbie.

The real only advantage I'm aware of from a 401k loan is that you are borrowing from your own money. On the downside, those shares used in the loan earn no interest.

401k loans are not a way to go unless you really need it and know you won't be laid of. It needs to be paid immediately if you lose your job, and it is done by selling off part of your 401k if you cannot otherwise pay it. Tremendous tax penalties apply this way. It once happened to me!