CHARLOTTE, N.C.–Cash-out refinancing is being increasingly used by borrowers and homeowners looking to renovate their homes, consolidate debt, make a purchase, or even as a down payment for a second home, according to a study by Lending Tree that also reveals which cities have the highest levels of cash-out refi’s.
According to the Lending Tree data, cash-out refinance loans have risen to 62% of all refinancing in the first quarter of 2018 from 54% during the same quarter in 2017.
To determine which cities and regions had a greater ability to access cash through refinancing a mortgage, LendingTree said it analyzed mortgage requests and offers for refinance borrowers between March 1, 2017, and March 1, 2018, based on the location of the property to be mortgaged.
It then based the rankings on the percentage of total refinance mortgage funded that included a cash-out portion of the loan.
Among the findings:
- Albany, N.Y. had the highest share of cash-out borrowers with an average loan amount of $166,504 and 73% of the refinance mortgages funded with a cash-out portion.
- Portland, Ore., and Cape Coral, Fla., finished in a tie for second, with 72% of refinance mortgages being funded with a cash-out portion. However, the average loan amounts varied widely in the two markets, with Portland recording average loan amounts of $266,152, while and Cape Coral had an average $162,975.
- Other cities making the list included Boise City, Idaho; Scranton, Penn.; Denver; Greenville, S.C.; Colorado Springs, Colo., and Tulsa, Okla. Three cities tied for the tenth place in the rankings: Des Moines, Iowa; Grand Rapids; Mich.; and Ogden, Utah.
The study found the cities with the biggest cash-out amounts were, not surprisingly given their high real estate values, Bridgeport, Conn., at $453,307 earning it the first spot on this list, and San Jose, Calif., at $451,777.
Also on the list were San Francisco, which came in third with an average loan amount of $442,099, followed by Honolulu, San Diego, Los Angeles and Oxnard, Calif.; Washington, Seattle, New York, Boston and Denver.