BLACK KNIGHT’S JULY 2021 MORTGAGE MONITOR
Tappable Equity Rises $1 Trillion in Q2 2021 Alone to Hit All-Time High of $9.1 Trillion; Quarter Also Sees Largest Volume of Cash-Out Refis in 15 Years
Driven by the red-hot housing market, tappable
equity – the amount available to homeowners before reaching a maximum 80% combined loan-to-value (CLTV) ratio – surged nearly 40% from last year At $9.1 trillion in total – yet another record high – the average
mortgage holder now has $173,000 in tappable equity available to them, an increase of $20,000 from just the end of the first quarter Fewer than 3% of mortgage holders have less than 10% equity – the lowest share ever observed – with the overall weighted average CLTV now 46%, the lowest mortgage-to-value leverage on record
Some 98% of borrowers in active
forbearance have at least 10% equity, as compared to the Great Recession when 40% of all mortgage holders had less than 10% equity with 28% fully underwater Even when adding 18 months of deferred
principal, interest, taxes and insurance payments onto the total debt amount, only 7% of borrowers in forbearance would have less than 10% equity in their homes More than $63 billion in equity was withdrawn via 1.1 million cash-out refinances originated in the second quarter, the largest quarterly volume since mid-2007
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Suraj Shrestha is an associate at Harborside Partners. He has been taking the lead role on research projects; to develop and implement online marketing strategies for search engine optimization and social media marketing. He is one of the core parts for helping to grow business revenue and the company’s online presence.
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