Homeowner Regret: The Refinance Train

Homeowner Regret: The Refinance Train

It’s no shock or surprise to read that mortgage rates are currently (still) at historical lows, but what may be a surprise – are homeowners who didn’t refinance and jump on saving thousands of dollars.

What happened?

2020 was a big refinancing boom, obviously due to the incredibly low rates. However, according to LendingTree, more than a third (36%) of homeowners report having regret after not taking advantage of the low mortgage rates. Most homeowners incorrectly assumed that in order to refinance, they had to work with their original lender (false) or only had the option to refinance their mortgage once (also false).

And 11% of homeowners also currently do not know what their mortgage rate is, or even if it’s worth it to refinance at all.

Interest rates are currently sitting at 3.060% for a 30-year fixed mortgage rate and 2.340% for a 15-year fixed mortgage rate – but about 34% of homeowners (over a third) have a 4% mortgage rate or higher.

So, who did take advantage of refinancing? Looks like Millennials were the ones to jump on board last year. 42% of Millennials, 18% of Gen Xers, and 10% of Baby Boomers refinanced within the last year.

However – it looks like with all the reporting on “missed refinancing,” homeowners are starting to consider it in the next year, about 49%.

For more real estate news, stop by Pacific Alliance Title’s Blog.

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