Mortgage

Federal Reserve: More homeowners are getting their refi applications rejected

Rejection rate highest since the Fed began polling

Every few months, the Federal Reserve Bank of New York’s Center for Microeconomic Data releases a survey of consumer experiences. The survey is the result of panel data acquired directly from consumers when they apply for credit.

That survey covers a wide range of asset classes, from credit cards to auto loans, and even mortgages. The big news today is that the latest poll finds that rejection rates are on the decline across all credit applications, but not for mortgage refinancing.

The survey instead finds that more homeowners are getting their refi applications rejected. In fact, this rejection rate is the highest since the Fed began polling consumers about their credit experiences.

“The October rejection rate on mortgage refinance applications of 34.3% is the highest reading since the start of the SCE Credit Access Survey in October 2013. For 2018 overall, rejection rates for credit cards and credit card limit extensions and for mortgage refinancing exceeded those in 2017, while those for auto loans and mortgage applications were stable,” the Fed reports.

Of course, with interest rates rising, refinance applications are slowing down, too. For mortgage refinance applications, 2018 respondents reported a 6.8% likelihood of applying over the next 12 months, compared with 8.2% for 2017 respondents. Further, more and more Americans also report that they don't plan to bother even trying to apply for a refi in the next 12 months.

 

Most Popular Articles

HomeStreet Bank fined for kickbacks to real estate agents, homebuilders

The FDIC announced Wednesday that it reached a settlement with HomeStreet Bank after an investigation found that HomeStreet had paid kickbacks to real estate agents and homebuilders in exchange for their mortgage business.

Nov 06, 2019 By

Latest Articles

Zillow experiences growing pains as it moves from listing houses to buying them

In the last few years, Zillow has reshaped its entire business, moving from a real estate listings website to a company that supports the entire homebuying and selling experience. And while the company is seeing positive results in terms of growth and revenue generation, Zillow is also experiencing some serious financial growing pains as it expands.

Nov 11, 2019 By