As mortgage rates trickle down, the number of those with the potential to refinance their homes continues to expand.
The latest ICE Mortgage Monitor shows that the number of “high quality” borrowers who can refinance their loans is now at a 3.5-year high of 1.7 million. ICE counts high-quality refi candidates as those who could trim their rate by at least 0.75 percentage points and have a FICO score of 720 or higher and more than 20% equity in their houses.
If rates were to drop just a tad, from 6.17% to 6.125%, the company says the pool of borrowers “in the money” for refinancing would grow to five million.
ICE’s daily performance data shows that prepayment speeds “rose sharply” in September and October, with most of the activity coming from borrowers who took out their mortgages between 2023 and 2024. As of mid-October, prepayments more than doubled compared to August levels for Ginnie Mae and GSE-securitized loans written in those two years.
The latest Mortgage Monitor also found that the average borrower has $204,000 in available equity in their properties. In total, borrowers hold $17.3 trillion in home equity, of which $11.2 trillion can be accessed by a home equity loan while still maintaining a 20% stake in their properties.
While growth in home equity has flattened alongside slower home price appreciation in recent months, ICE reports, the monthly cost to withdraw $50,000 in equity has fallen by more than $100 from recent highs as HELOC interest rate offerings have fallen from nearly 10% in early 2024 to the low 7% range in Q3 2025.
“The recent easing in mortgage rates has begun to open the refinance window for many borrowers, particularly those who originated loans in the past two years,” Andy Walden, head of mortgage and housing market research at ICE, said in a statement. “At the same time, home owners still have near-record amounts of tappable equity, and the cost to access that equity continues to improve. Together, these trends are creating meaningful opportunities for borrowers to leverage rate-and-term refinances and second-lien home equity products.”
All is not well throughout the land, though. ICE’s national negative equity rate blossomed to 1.6% in October, the highest rate in three years. Pockets of distress include Cape Coral, Florida, and Austin, Texas, where the typical borrower has negative equity of 11% and 6.9%, respectively.
Risk, ICE says, is particularly elevated among recent low-downpayment FHA and VA loans.
