Still Living High on the Hog...
"Many U.S. homeowners continue to take cash out of their homes even as mortgage rates climb and home sales slip, helping to brace the economy, economists said."
'"I would have thought the home equity extractions would have been much weaker now," said Frank Nothaft, chief economist for the mortgage finance giant."
"This year, Americans who refinance their mortgages are expected to draw $257 billion of wealth out of their homes, according to mortgage finance giant Freddie Mac."
"That's $13 billion more than the refinancing cash-out seen in 2005 - the hottest year of the recent housing boom."
"Doug Duncan, chief economist of the Mortgage Bankers Association, credits the mortgage industry for making refinancing easier and cheaper in recent years."
"Give homeowners with untapped reserves of wealth a simple process to refinance and they will naturally be tempted to cash-out, he said."
'"One of the big changes is that people look at their home as a financial asset," he said. "In another generation, the notion was 'Burn the mortgage.' That phrase is not in fashion anymore."'
"It is hard to tell exactly where refinancing cash is going, said Nicolas Retsinas, director of Harvard University's Joint Center for Housing Studies, and so gauging the impact of refinance spending "is pretty murky."'
"Still, he said, "all economist would agree that refinancing home equity loans has boosted spending."'