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To: Les H who wrote (98975)	5/2/2001 11:30:03 AM
From: Les H	Read Replies (3) \| Respond to of 436258

median age of refi's at 19 months MORTGAGE TALK: Freddie Mac's latest quarterly refinancing survey found that most of the loans refinanced in the first-quarter refinancing boom were originated after the last refinancing boom of 1998-1999. That put the median age of refinanced loans at just 1.6 years, the lowest ever since Freddie Mac began tracking the average age in 1997. Notably, 50% of the refinanced loans were for an amount 5% or higher than the original mortgage. "In contrast, in the first quarter of 2000, when mortgage rates were over 8% and refinance volume was much lower, 81% of refinancings were at least 5% higher than the existing mortgage loan," Freddie said. The survey found that properties backing refinanced loans appreciated 11% in value by the time the loan was refinanced. The Fed recently wrote a research report called "The effects of recent mortgage refinancing," wherein they discuss the extent to which people refinance their homes, the extent to which refinancing homeowners "cashed-out" some of their equity when they refinanced, how much equity they took out, and how they spent the funds. The results of the their study give excellent background information for investors in mortgage securities and are also a great tool for getting the sense for the economic impact of refinancing activity. The Fed study found that in the last big refinancing boom in 1998-1999, nearly 8 million homeowners refinanced their homes. Of those homeowners, 35% took cash-out mortgages wherein they tapped into their home equity to the tune of $55 Bln. A good deal of this was spent, of course, with $10 Bln channeled to ordinary expenditures and $18 Bln channeled toward home improvements. >>>would think the capacity of refi's to prop spending has >>>greatly diminished unless Al inflates prices moreso.