Surge in Cash-Out Refis Doesn’t Concern UI Researchers

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Posted To: MND NewsWire

Cash-out refinancing is currently a larger share of the refinance market than at any time since the financial crisis . However, the Urban Institute (UI) says even though those refinances were one of the main contributors to the crash, the present trend doesn’t worry them. Cash out loans, defined as those where the new loan is at least 5 percent larger than the loan it replaces, made up 77 percent of total refinances in the second quarter of 2018. According to Freddie Mac, which tracks its loans that are refinanced into another Freddie Mac product, this is the largest share since 2008. Despite the high percentage of loans, the dollar volume of equity that is being withdrawn is still well below the crisis peaks. Homeowners cashed out $15.8 billion in equity during the second quarter of this year…(read more)

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