Early this month, we watched as refis dipped below 50 percent, and with rates continuing to rise, many have declared the death of the refi era. Last year, rising home prices led to the highest level of cash-out refi's since 2005, with lenders originating $1.2 trillion of them throughout the year. When comparing the first to the fourth quarter of 2021, Cash-out refis swelled from 36% to over 60% of the volume of refis. Homeowners were able to tap $275 billion in equity, with the overall origination volume reaching a record high of $4.4 trillion.
With rising rates amidst soaring inflation, it appears likely that the share of refinances will continue to trend downward. In a lower-volume environment, it’s more important than ever to be able to differentiate yourself, and product knowledge is becoming more important than ever. With less business to go around, leaving that extra special impression on your borrowers can be the difference between losing and retaining that all too critical business.