HELOC Catch-22 Advice?

We had gotten a home equity line of credit to do some improvements on our home. In the process, we found some very serious structural problems which ate up much of our budget.

We now find ourselves looking to increase the line of credit. But our bank, caught in the current crunch, isn't giving more. And other banks won't commit to a new HELOC for a home with construction going on. I'm pretty sure we are in good shape on equity/debt ratio, income, etc. It's just the construction messing us up.

I looked into temporarily borrowing against our retirement for the chunk remaining. But, my wife is a freelancer and cannot borrow against her SEP. I left my job to freelance and consequently lost the ability to borrow against my 401K.

Any recommendations on how we can get the money to finish this?

Thanks much!

Without details about how much you need to finish, how soon you could repay, etc. it's tough to provide much help. I'd be talking to the bank trying to convince them that they're better off if their collateral had the "serious structural problems" fully fixed. Would they be willing to refinance 1st/2nd mortgages? In today's market, I'd do everything possible to keep the debt tied to the home. Borrowing retirement funds or using credit cards to fix up a home that may be falling in value anyway increases your risk further.