Over the next year, lenders are expected to make about $36 billion in new home equity loans, compared to $34 billion in 2008, according to Moody's Economy.com. Most of this money is expected to go towards home improvements rather than luxury items.

The 2010 growth in equity lending will be limited to homeowners whose properties are worth more than what they owe. According to Zillow, more than a fifth of U.S. homes with mortgages had negative equity in the fourth quarter.

Despite the economic distress, unemployment claims are lightening and banks are done tightening their lending standards. Property prices are expected to rise this year, the first time since 2006, raising home owners' equity.

Read more in the Bloomberg report on BusinessWeek.com.

Posted in Education And Training, MBI Headlines, Buyer Resources, Seller Resources

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