Industry News

Freddie Mac: 89% of refis involve cash out

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

Freddie Mac reports that 89 percent of people who refinanced loans owned by the government-backed mortgage repurchaser in the third quarter took cash out -- the highest level recorded since 1990. Although the percentage of people taking cash out when refinancing their homes is up, the total dollar value cashed out declined, because fewer people are refinancing or signing up for new purchase mortgages. In the third quarter, Freddie Mac saw $82.8 billion cashed out, down from $90.6 billion in the second quarter. Cash-out refinance volume is expected to decline further in the fourth quarter to less than $65 billion, due to lower expected refinance shares overall and lower mortgage origination activity, Freddie officials said in a press release. Freddie's Primary Mortgage Market Survey found the share of all mortgage applications that were for refinance slipped for the third consecutive quarter, from 42 percent in the second quarter to 41 percent in the third quarter. The survey classifie...