More Affluent Homeowners Sought New Refinance Loans in Q1 2018

June 29, 2018 Zach South

A shift in the refinance market occurred from 2017 and Q1 2018, resulting in more affluent homeowners with increased home values and higher mortgage balances, seeking new refinance loans according to the Q1 2018 Mortgage Consumer Profile Report published today by Best Rate Referrals.

Low Rates Encouraged Refinancing to Lower Payments

In the summer of 2016, mortgage rates fell to 3.36% for 30-year fixed mortgages, hitting their lowest point since 2012. Shortly thereafter, many affluent homeowners refinanced their homes to receive an instant decrease in their monthly mortgage payments.

As Rates Rose, Home Values Did Too

Mortgage rates snuck up in 2017, but so did home prices. During 2017, the cumulative value of all homes in the U.S. increased 6.5%, adding billions of dollars of equity to homeowners across the country.

Increased Home Equity Encouraged a Growth in Cash-Out

As rates continued to rise into 2018, affluent homeowners transitioned away from refinance loans. Instead, these borrowers decided to take advantage of their new equity through cash-out refinance mortgages and home equity lines of credit (HELOCs). Due to this transition, we saw a large jump in average loan amounts compared to 2017.

Mortgage Values for Potential Refinance Borrowers Rose the Most in the Pacific & Mid-Atlantic

According to the Q1 2018 Mortgage Consumer Profile Report , the Pacific and Mid-Atlantic regions of the U.S. experienced the largest increase in average current home market value from 2017 to Q1 2018 for prospective borrowers inquiring about refinance mortgages. The smallest increases in home market values for this borrower group occurred in the East South Central and West South Central regions of the country.

Read More in the Just Published Q1 2018 Mortgage Consumer Profile Report

The new Q1 2018 Mortgage Consumer Profile Report, published by Best Rate Referrals, highlights mortgage market consumer trends, including:

  • Consumer-estimated credit scores by mortgage product and region
  • Home market values by mortgage product and region
  • Mortgage balances by mortgage product and region
  • Top consumer segments by mortgage product
  • Top consumer segment profiles (including demographic and behavioral attributes)
  • Marketing strategies for loan originators

Complete the form below to download your free copy of the Q1 2018 Mortgage Consumer Profile Report.

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About the Author

Zach South

Zach South is Senior Vice President of Lender Operations for Best Rate Referrals, an award-winning consumer finance marketing firm with NMLS operating licenses in most states. Since its inception, Best Rate Referrals has connected millions of high-intent consumers with a diverse network of lenders for variety of financing products. Zach built one of fastest growing online mortgage marketplaces, www.MortgageAdvisor.com, which now generates demand from thousands of consumers monthly looking for purchase, refinance and home equity loans. In 2018, Best Rate Referrals expanded into the world of personal finance with the launch of Loan Advisor, a new online marketplace designed to provide consumers with simple and fast personal loan quotes from lenders for free.

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