Economists are split at the moment on this question. Clearly there will be some spillover. But, many believe it will be contained. So far, consumers are managing other forms of debt such as auto loans and credit cards. At least 20 subprime lenders have already gone out of business. Subprime foreclosures are skyrocketing as mortgage rates for these loans climb to as high as 12% for low-income buyers. This could spell trouble for discount retailers like Walmart and Target. But what about the big box home improvement stores, Home Depot and Lowes? The jury is still out on this question. Will homebuyers continue to renovate, or will the fall in housing prices dent the home equity cash-out refinance market? Contact me. I would love to hear from you.