Cash-Out is King in Q2 Refi – NMP Skip to main content

Cash-Out is King in Q2 Refi

Phil Hall
Oct 03, 2016
Cash-out transactions accounted for 42 percent of refinance activities during the second quarter, according to new data released by Black Knight Financial Services (BKFS)

Cash-out transactions accounted for 42 percent of refinance activities during the second quarter, according to new data released by Black Knight Financial Services (BKFS). The $22.6 billion in equity that was tapped via cash-out represents the largest sum of its kind since the second quarter of 2009, although it is nearly 80 percent below the equity draw peak that was reached in the third quarter of 2005.

The second quarter also markets the ninth consecutive quarterly increase in cash-out lending by both loan count and sum of equity draw. The average credit score of cash-out refinance borrowers during the quarter was 748, which is nearly 60 points higher than the overall 2005-2007 average. Nearly three-quarters of mortgage refinances this year went to borrower whose prior mortgages were originated in 2009 or after, while 40 percent of rate/term refinances involved the borrower reducing the term of their original loan.

“Today’s cash-out refinance borrowers continue to present a relatively low risk profile, historically speaking,” said Black Knight Data & Analytics Executive Vice President Ben Graboske. “The average credit score of 748 among second quarter 2016 cash-out refinance borrowers is 67 points higher than that of the low point recorded in third quarter 2006, and is in fact nearly 60 points higher than the overall average credit score from 2005 through 2007. In addition, post-cash-out loan-to-value ratios remain low. At 66 percent, it’s slightly higher than in first quarter 2016, but it’s the second lowest quarterly average recorded in over 11 years. This is nearly six percent below the 2005-2007 average and 10 percent below the highs recorded in late 2008.”

Published
Oct 03, 2016
Manufactured Housing: The New Affordable Alternative

While the housing market is grappling with widespread affordability and supply, manufactured homes are gaining ground as a new alternative. 

Industry News
Dec 03, 2021
Angel Oak Home Loans Opens 3 New Branches

Continues expansion in Western U.S. with new branches in California, Nevada & Utah.

Industry News
Dec 02, 2021
Open Mortgage Names New President

Joe Stephenson, formerly of American Advisors Group, to lead daily operations.

Industry News
Dec 01, 2021
Homepoint Expands Refinance Program Offerings

Now offers Freddie Mac’s new refinance option, Refi Possible, making it easier for many homeowners with a Freddie Mac-owned mortgage to reduce their interest rate.

Industry News
Nov 30, 2021
Non-QM Lender Deephaven Hires Business Development VP

Dallas-based Tim Fisher charged with growing Deephaven’s correspondent business In Texas and surrounding states

Industry News
Nov 30, 2021
Biden Reappoints Powell As Federal Reserve Chairman

A signal that The Fed will continue its policies as inflation surges and economic uncertainty spikes due to an emerging variant of the coronavirus. 

Industry News
Nov 29, 2021