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• The lender encourages you to borrow heavily from the equity in your home (the amount you own free and clear of your mortgage) as an easy way to get additional money, consolidate debt or fund home repairs, knowing that the fees and payments are so high you may not be able to make them. You dramatically reduce your equity and, in the worst case, the lender forecloses on the loan, takes possession of your home, and strips you of the equity.

  State of New Jersey, Department of Banking & Insurance - Cite This Source - This Definition
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  Cite Definition for Equity stripping

  American Psychological Association (APA)

  Equity stripping. (n.d.). Glossary of Common Mortgage Terms. Retrieved February 5, 2023, from website: http://www.expertglossary.com/definition/equity-stripping.

  Chicago Manual of Style (CMS)

  Equity stripping. www.newjersey.gov. Glossary of Common Mortgage Terms. State of New Jersey, Department of Banking & Insurance. http://www.expertglossary.com/definition/equity-stripping (accessed: February 5, 2023).

  Modern Language Association (MLA)

  "Equity stripping." Glossary of Common Mortgage Terms. State of New Jersey, Department of Banking & Insurance. 5 February. 2023 http://www.expertglossary.com/definition/equity-stripping.

• Browse Related Terms: Collateral, creditor, Equity stripping, Home Equity Line of Credit (HELOC), Home Ownership and Equity Protection Act (HOEPA), interest, Interest rate, Loan modification activities, Principal, Rate Spread, Servicemen’s Readjustment Act, Truth-In-Lending Act (TILA)