Where Homeowners Have Difficulty Refinancing

Real estate experts at LendingTree recently released findings related to mortgage refinancing in each state after analyzing data taken from more than 15 million mortgage applications nationwide.

With the country currently seeing mortgage interest rates at historic lows, many homeowners are looking into refinancing their home loans in hopes of taking advantage of those low rates. In fact, many experts have recently published reports that such a course of action could reap homeowners significant rewards via thousands in savings when it comes to monthly payments during the lifetime of the loan.

Despite the lure of such high savings, some homeowners are still deterred from pursuing refinancing due to their fear that they may be turned down during the approval process. But the good news is that according to LendingTree, an estimated average of about 86% of mortgage refinance applications are currently approved nationwide.

It is noteworthy that home-price appreciation and credit scores matter when seeking approval for refinancing. Specifically, ten-year, home-price appreciation and a borrower’s credit score are considered to be the proverbial pushes needed to receive a positive refinance rate that is enough to jump the hurdle to final approval.

Even though other factors are also considered in the process, this basically means that those homeowners with higher credit scores and who own homes that have increased in value have a far better chance of qualifying to refinance.

In light of this surging interest in refinancing, LendingTree set out to discover how approval rates differ across the United States. They did this by analyzing data gleaned from more than 15 million mortgage applications using the most recent 2019 Home Mortgage Disclosure Act (HMDA) statistics.

LendingTree then took their findings and reported on which states had the highest and lowest refi approval rates. According to LendingTree, 80% or more of refinance loans are approved in 48 of the nation’s 50 states, with no state posting a single approval rate below 78%.

The highest approval rates were found in the South Dakota (91.29%), Utah (90.74%), North Dakota (90.65%), and Nebraska (and 90.53%). As for the lowest approval rates, those belong to Florida and New York, which posted 78.43% and 79.60%, respectively.