The real concern for the banks is that HELOCs are second lien mortgages, so the risk is considerably higher if there's a default. First lien mortgages get the

The real concern for the banks is that HELOCs are second lien mortgages, so the risk is considerably higher if there's a default. First lien mortgages get the house. Second lien gets whatever's left over, and guaranteed that the process is painful. Chase did the same thing a while back, for the same reasons.