Though rates are on the rise, nearly 10m loans are still ripe for refinancing, according to a new report
Think the refinancing wave is coming to a halt? Not yet. Roughly 18% of all loans, or about 9.4m loans, are in a place to be refinanced, according to a report.
Based on refinancing characteristics, such as an loan-to-value ratio of less than or equal to 80%, a borrower credit score of greater than or equal to 720 (prime borrowers), and also interest rate incentives, whether the borrower is “in the money”, there are still 9.4m borrowers that would benefit from refinancing at the end of 2012, a report by Lender Processing Services showed.
Since then, there have been about 1m refinancings, continuing housing market improvement is likely to lead to an additional number of eligible borrowers, according to Herb Blecher, senior vice president of LPS.
“More and more borrowers are getting into the eligible [refinancing] status based on continued home price improvement,” and increased liquidity for lower credit borrowers (seen over the last few months), he said in a video report.
The report also highlighted that total loan originations were up 22% year-over-year to 884,000 as of March 2013, increased 18% month-over-month.
The report also detailed that foreclosure sales in states with court-processed foreclosures (judicial states) grew 17%, meaning that historically low foreclosure inventory on the market (now 3.2%, the lowest in four years) is likely to start to grow.
