Taken out a home equity loan recently? The banks are making sure you’ll pay it back:

As the housing market spirals downward, home equity loans, which turn home sweet home into cash sweet cash, are becoming the next flash point in the mortgage crisis.

Americans owe a staggering $1.1 trillion on home equity loans — and banks are increasingly worried they may not get some of that money back.

To get it, many lenders are taking the extraordinary step of preventing some people from selling their homes or refinancing their mortgages unless they pay off all or part of their home equity loans first. In the past, when home prices were not falling, lenders did not resort to these measures.

It’s like brick after brick in this fiscal crisis.

Two years ago a Realtor friend said, oh, if you wanted to sell your house, you could probably get X for it.

I thought: No way is this house worth X.

I mean, might it have fetched that on the market? Maybe. But it wasn’t worth that; isn’t worth that. And I just get this sense that over the past five years or so, people have thought - well, if it would fetch X, then certianly it’s worth X; and not only that, I’ll take out home equity loans based on X because surely the value of X will never be diminished, it’s only going to go up and up.

I’m all for new regulations which punish deceptive lenders. But I can’t shake the feeling that the blame for the current fiscal crisis lies largely with us - those of us who thought the good times would go on forever, and based our financial decisions on that thought.