The Big Freeze: Tips for Dealing with a Frozen or Reduced HELOC

One result of the credit crunch and the economic recession has been the freezing or reduction of home equity lines of credit (HELOC) by banks. A HELOC is a form of revolving credit in which the borrower's home serves as collateral. And while this is not a surprising move by banks looking to be more conservative with their lending policies during tough times, many home owners counting on this credit will face some challenges if their HELOC is reduced or frozen.
To help you deal with these challenges, the US Treasury Department and the Federal Reserve each released some tips for homeowners in this situation. The following is a summary of these tips: