After taking an absolute beating this year, the refinance market just got its first ray of sunshine in 2018.
According to Ellie Mae’s Origination Insight Report, the percentage of refinances closed went up for the first time in 2018 in August.
By the end of August, refis closed increased from July’s rate of 29% to 32%.
According to the report, slowing growth in interest rates have brought refi seekers out of the woodwork and helped to put the refi market back on the treadmill.
“The rise in interest rates has slowed since June, and we are seeing the percentage of refinances increase month-over-month since May,” Ellie Mae President and CEO Jonathan Corr said in a statement.
“This may reflect consumers taking an opportunity to refinance with the corresponding increase in equity,” he added.
On the topic of equity, U.S. homeowners are swimming in it.
According to a study by Black Knight, Americans are sitting on $6 trillion of equity, a Scrooge McDuck worthy pile of coin, but they haven’t been using it thanks to rising interest rates.
That’s what makes news of refis getting some love such a big deal. Should this uptick signal a larger trend toward sustained demand for refis, it could mean that refi lenders stand to make a lot of money as people start tapping their equity troves.