Freddie Mac reported that 66% of Freddie Mac-owned loans that were refinanced resulted in new mortgages with loan amounts that were at least 5% higher than the original loan balance in 2Q08,.
This is up from 58% in the first quarter. However, the press release noted that the first six months of this year marked the lowest cash-out share since the fall and winter of 2004-2005. A year and two years ago, respectively, the percents were 84% and 88%.
The median ratio of new-to-old interest rate was 0.93, which means that 1/2 of those borrowers who paid off their original loan and took out a new one decreased their original rate by about 7.5%. The median age of refinanced loans was 3.2-years, up from 2.4-years in the first quarter, and the median appreciation of the refinanced property was 12% compared to 8% in the last quarter.
"Declining home values across much of the nation have curtailed the amount of home equity available to be cashed out by homeowners," said Freddie Mac Chief Economist Frank Nothaft noted on the results.