Office of Research blog: A look at cash-out refinance mortgages and their borrowers between 2013 to 2023
As interest rates increased in 2022, the number of refinance mortgage originations declined, with cash-out refinances becoming a larger share of all refinances. Cash-out refinances exacerbated the 2008 financial crisis, but regulatory and market developments may have changed the risks of cash-out refinances to consumers and the mortgage market. A new analysis looks at the characteristics of these refinances and the rates of delinquency.