In no year prior to 2001, as best we can judge, did cash-outs exceed 1-3/4 percent of total home equity. Of last year's cash-outs, approximately $ billion was apparently applied to repayment of home-equity loans, and a significant part was employed to reduce higher-cost credit card debt, judging from the slowed pace of growth in installment debt outstanding.
Previous Federal Reserve surveys of the disposition of cash-outs indicate that a substantial amount perhaps half - was used to finance home modernization and personal consumption expenditures, outlays that directly affect GDP and jobs, and that likely was the case again last year.