Lots of analysts and industry stakeholders have jumped at the chance to offer pithy quotes on why it never made sense in the first place and how positive this is for the refi market.
So let's talk about the upcoming year or two when it comes to refis.
You might have noticed that Freddie Mac yesterday issued their revised forecast on mortgage origination volume expectations in 2021 and 2022.
The GSE in April forecasted $3.5 trillion in total originations in 2021. But yesterday, Freddie revised that forecast to $3.9 trillion in originations, pretty dang close to 2020's $4 trillion sum. The company said that refis largely account for the difference, and I suspect they knew the adverse market fee was going to be killed on Friday.
Of course, lower rates incentivize more people to refinance their mortgages. People who have been sitting on the fence about a refi will now save one-eighth of a point in interest rates. That's on top of rates having fallen to February levels.
Here's what I don't get: who are these fence-sitters? Who out there is aware that they could save a few hundred dollars a month through a refi and is like, "You know what? These conditions are not good enough. Maybe if rates hit the 1% level I'll consider it!"?
LOs: Do you have refi fence-sitters? Why haven't they pulled the trigger yet? Would 50 bps make a difference?
I'd also love to hear what you are forecasting in terms of refi volume from your clients this year. And finally, what do you expect to see in 2022 (the experts say it will be a weak refi market – $700 billion)? Hit me up anonymously at jkleimann@housingwire.com.
Hope you have a great weekend!
James Kleimann
Managing Editor, HousingWire
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