Wednesday, September 15, 2010

Home loan demand drops as refinancing loses luster

With so many homes that have negative equity only a few home owners can qualify for a refinance on their house.  This is probably why you are see a drop in refi's.

It's going to be interesting to see what happens when interest rates increase and mortgage payments increase.  I think you will see more jingle mail from home owners or they will just not pay their mortgage until the bank will kick them out.  My two bit theory as mortgages recast or mortgages arms expire you'll see another round of loan defaults and you might be see it happening right now.

"Many people do not have enough value in their home to refinance and at the same time lending guidelines are getting stricter and making it harder for even the most qualified people to get a loan," he said.
 These low rates are really just benefiting new home owners on purchase loans

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