Tag Archives: Home Equity

RealtyTrac reported that 8.1 million U.S. homeowners, representing 15 percent of all mortgages in the country, were seriously underwater on their mortgage in Q3, the lowest percentage of underwater mortgages nationwide since RealtyTrac began tracking the data in Q1 2012.

Credit reporting agency Equifax released on Monday its latest National Consumer Credit Trends Report, revealing that the total balance of new credit for revolving home equity loans in the year's first seven months was $65.9 billion. The figure, up 21.4 percent year-over-year, marks a six-year high.

Home equity lending made solid strides in the last year but still has a lot of ground to cover to return to pre-crisis levels, housing data firm RealtyTrac said in a new report Thursday. In its first-ever U.S. Home Equity Line of Credit (HELOC) Trends Report, the company revealed that lenders originated an estimated 797,865 HELOCs in the 12 months ending in June, up 20.6 percent from the prior period and the highest level since the year ending June 2009.

Property information firm CoreLogic reported that nearly 946,000 homes returned to positive equity in the second quarter, meaning the mortgage holders owe less on their loan than the property's worth. With the most recent quarterly increase, CoreLogic estimates the total number of mortgaged homes with equity across the country has surpassed 44 million.

Payment shock among holders of home equity lines of credit (HELOCs) is a growing concern as 2.5 million HELOCs are scheduled to reset over the next three years, according to the latest Mortgage Monitor Report from Black Knight Financial Services. In fact, the average HELOC holder faces a monthly payment increase of $250 sometime in the next three years as he or she reaches the end-of-draw period.

Now that so many of the once-popular home equity lines of credit (HELOCs) are coming due, many borrowers could be in for what TransUnion calls "payment shock." A new study by the credit reporting agency shows that nearly half of all HELOC balances at the end of 2013—totaling about $474 billion—were originated between 2005 and 2007. Many of these HELOCs had 10-year draw periods, which means that the bill will soon come for those borrowers.

After fizzling out over the past several quarters, the post-recession refinance boom officially ended in the quarter, according to data from Freddie Mac. The mortgage behemoth released on Tuesday the results of its quarterly refinance analysis for Q2, showing that refinancing fell in the last three months to below 50 percent of total mortgage activity as rising interest rates have stifled demand.

Analyzing data as of the end of May, Black Knight Financial Services reported another gain in monthly prepayment activity—an indicator of refinancing—marking the third straight month of increases. At the same time, long-term fixed mortgage rates fell to 4.19 percent, their lowest level in more than half a year. Meanwhile, Black Knight also found that seasonal purchase origination activity has risen, with approximately 897,000 originations through April.

On Wednesday, four federal financial regulatory agencies and the Conference of State Bank Supervisors (CSBS) issued risk management guidelines for financial institutions that need to be aware of the challenges borrowers may face in paying off their home equity lines of credit after coming out of a recession.

California home sales and prices were both on the rise in May, but the year as a whole still looks pretty grim for the Golden State. Compared to April, May home sales statewide increased 3.5 percent, according to real estate site PropertyRadar.com. Year-to-date, however, PropertyRadar reports sales are the lowest they've been since the start of the recession.