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					        PULSE                 LOANS            WOMEN-OWNED BUSINESSES

                                                                                                  -   :'-•*•-   *




 By Damon dim                                                                                                                                                                 Most banks only lend upto 80 percent of the
 Morris Newsservice                                                                                                                                                        appraised market value of die home minus die
                                                                                                                                                                           mortgage balance. But die newest, and most
                                        AUGUSTA-                                                                                                                        t controversial type of home equity loan, sorhe-
               N Q P                         equity                                                                                                                     ' times called >"no equity" loans, allows the con-
           in your home can, depending on how                                                                                                                             sumer to borrow up to. 125 percent of f his
           wefl you manage your money, be one of                                                                                                                          homes value
         r
           the smatesf things you've ever done.                                                                                                                              "As far as those are concerned, I wouldn't
                                                  :
     It also can be your wqm nightmare.             .'                                                                                                                    even touch those." AshlejrsakL "What tf some-
     If youtelto Martinez resident Wane Hahn,                                                                                                                             thing happenedandyou had to getridof the
 who'stoiogaboBK equity loan to pay for home                                                                                                                              house? You could actually be in a negative equi-
 improvements, you'll find yourself saving bun*"                                                                                                                          ty situation and have to buy your way out* ...;
 dreds of dollars a year with tax-deductible                                                                                                                                 For example selling at120,000 house sad-
 interest payments.                                                                                                                                                       dled with $140,000 in debt would require the
   . But if you're one of those seeing Betty Ashley                                                                                                                       owne* to come up with the lender's $20,000 bal-
 of Consumer Credit Counseling Services of                                                                                                                                anctnSs well as real estate agent commissions
 Augusta, youVe likely overspent, areiup to your:                                                                                                                         and closing costs. And if you plan to keep the
 neck in mortgage debt and in danger of losing                                                                                                                            home, tapping out all the equity also prevents
 yourhome.              "           .                                                                                                                                • you from refinancing the home to take-advan-
     "Wfe have a lot of people who come through                                                                                                                     ..... tage of falling interest rates.
 here with home equity loans," she said. "The                                                                                                                             . While it's true the interest rates on equity
 reason is, it dkmt work out for them."                                                                                                                                  loans tend to bejower and are tax-deductible, a
     The equity loans let homeownerr borrow                                                                                                                              homeowner using home equity credit could be
 money against the part of their home* value                                                                                                                             paying for the car for 10 to 15 years, long after
 above the first mortgage.                     .                                                                                                                         exhausting its usefulness.
     Most loans come in two forms: the tradition-                                                                                                                     . v?And about 95 perptniof homeownen with'
 al second mortgage, a closed-ended, lump sum                                                                                                                            equity loans said they were aware of me possi-
loan with fixed, monthly payments; and the                                                                                                                               bility of foreclosure or other legal actions if they
equity line of credit, a revolving ^account that                                                                                                                         missed payments, according to the American
can be accessedin varying amounts as needed.                                                                                                                             Financial Services Association study.
Bankets created home equity credit-line loans                                                                                                                                Fully aware of the pitfalls. Hahn decided she
after, federal tax law changes in the 1980s                                                                                              HoWun/Mofris Nevrt i*r\<t
                                                                                                                                                                         would spend only about $8,000 on her $20,000
removed the deductibOity of interest paid on                                                                                                                            line of credit, just enough to pay for two badly
credit cards and car loans.                              Diane Hahn used her home equity loan to Install the new carpeting she's relaxing on.                           needed new air-conditioning units and new
    Consumers have flocked to the loans in                                                                                                                              wall-to-wall carpet
recerg years—more than 9 minion homedwn-                 no restrictions on what they can use it for," said erode a homeowner's built-up equity, but can                    The Regions Bank customer service rep said
ershttve them, a 28 percent increase since 1988,         Alan George, president of People's Community cause him to owe more than the home is worth. her amortization schedule is three years but
according to die American Financial Services             Bank.                                               A business owner using one could find a failing that she plans to pay it off in less time.
Association.                             .                  Others, however, establish a home equity line business could cost him his home as well               .;         And because the interest is tax-deductible
 -. Most use home equity money to_pay for the            to use only as a safety net                           "If you buy a car with a home equity line of she believes she is saving money in the long run
things they used to finance with credit cards or            "Some people will just have it there in case, as credit and you can't pay for it, they're not going by not tapping her savings.
vehicle loans.                                           a safety precaution," said Gene Wilson, a vice to come and take the car—they're going to take                      "I would have lost the interest on the money
    "Iris a consumer product It's not something          president with Wachovia Bank in Augusta.            your house," said Karen Stinson, a certified tax I took out" she said. "And I don't know if I would
that sfset up to use for a business, but there are          But used unwisely, die loans not only can planner in Augusta.                                              have paid myself back."




ByJIUanMlncar
Knlght-Ridder Newspapers                    Number of women-owned businesses skyrockets                                                                                       pened to me," she said. "If someone is
                                                                                                                                                                              laid off, they should never think of it
                                                                                                                                                                              as the end of the world. It was the best
                    KANSAS OTC M a                                                                                                                                            thing that happened to my career."
                                            that trend is. expected to continue              Thenumber of women                      firms, those with fewer than 20              Georgia L Clark also had to make


W
            hen doctors could not
            diagnose Judy Hohn's            during the next decade.                                                                  employees, and especially the small- an Important choice. She was living
            aches and pains, she start*         The number of women business                 business owners skyrock-                est with up to four employees, will be in Texas and supporting her 8-year-
            ed getting massages.            owners skyrocketed from 402,200 in                                                       the major sources of employment In old daughter when BranifT Airlines
   The experience not only eliminat-        1972 to nearly 8 million in 1997,                eted from 402,200 in                    the 21st century.                        went out of business.
ed the pain, it sparked her interest in     according- to the . Najipfcal.                   1972 to nearly 8 million in                 The fastest-growing sectors of ... Clark returned to Kansas City and
day spas as a way to reduce health-         Foundation for Women Business                                                            small-business dominated industries in 1981 launched Communications
care costs.                                 Owners. By 2000, women are expect-               1997, according to the                  include restaurants, physician Publishing Group.
   After five years of research, Hohn       ed to own 40 to 50 percent of the                                                        offices, computer and data process*          "1 knew exactly what I wanted to
left a successful career In benefits and    companies.                                       National Foundation for•<-.                g services, child care providers, do, I just didn't have any clients," she
opened Serenity the Rejuvenating               Several factors have contributed to           Women Business Owners.                  medical and dental laboratories and said.
                                                                                                                                     special trade contractors.                  Today, the full-service public rela-
Day Spa in Overland Park.                   this dramatic increase in the number
   "I had always had it in the back of      of women entrepreneurs, including                                                            Like many others, Emine Griffith tions, marketing and publishing firm
my mind that I would one day own a          downsizing, the glass ceiling and a           leave corporate America to launch          didn't set out to becorne a business has 12 employee* and, among other
business," said Hohn. who in 1997           strong economy. New technologies,             their own businesses.                      owner. In 1986, she was laid off from things, produces four national maga-
was honored as the Entrepreneur of          such as the Internet, video confer-               The administration expects that        her job at a large advertising compa- zines and a local ona
the Year by the Women's Chamber of          ences and fax machines, also have             despite barriers to small-firm growth      ny.                  . - . " » •            tn 1993, Clark also established the
Commerce of Greater Kansas City.            made it easier for people to launch           in the next century, small businesses          She expected to relocate but part- ' Eagle Awards to recognize unknown
    Hohn* experience is not unusual.        home-based businesses.                        and entrepreneurship will continue         ed getting free-lance projects la>d but rising leaders among African-
During the past decade and a half,                  The       Small      Business         to grow and make significant contri-       within a few months had gotten so Americans and Hispanics.
the number of women-owned busi-             Administration expects this trend to          butions in terms of job creation,          much work that she launched her              "1 like the challenge, and I know
nesses has been growing twice the           continue into the 21st century, espe-         innovation and empowerment.                own company, Emme Inc.                   that I own what I earn," she said. "It's
rate of male-owned businesses. And          dalry as more highly trained women                Research indicates that smaller            "It was the best thing that hap- Sip [o me to rnake the difference."


                                                                                                                                          • • • • Momlngtfowfca Sunday, January if~-iO0Q - 150

				
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