Magazine article Mortgage Banking

Tappable Home Equity Up $600 Billion over Last 12 Months

Magazine article Mortgage Banking

Tappable Home Equity Up $600 Billion over Last 12 Months

Article excerpt

While the refinanceable population continues to shrink because so many have already refinanced, there are 5.2 million borrowers who could still benefit from refinancing their home loans. That is among the findings from Black Knight Financial Services Inc.'s (BKFS') Mortgage Monitor Report released on Jan. 11.

The report estimated that the amount of tappable home equity grew by $600 billion over the last 12 months and had reached $4.2 trillion.

Based on data as of the end of November, the company said that 2.4 million borrowers could save $200 or more per month by refinancing their home loans. Yet as rates rise, the population eligible to refinance will shrink quickly.

The Data & Analytics division of BKFS found that a 50 basis point rise in interest rates would eliminate 2.1 million potential candidates from refinance eligibility, while a 1 percentage point rise eliminates 3.1 million.

"Looking at current interest rates on existing 30-year mortgages and applying a set of broad-based underwriting criteria, we found that there are still approximately 5. …

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