It’s like the mortgage refinancing boom (that led to this mess) all over again.
Mortgage financier Fannie Mae said refinance demand last month hit its highest point since 2003, with skyrocketing volume of $77 billion in March.
That’s nearly twice the refinance volume experienced in February and more than five times the amount in January, thanks to the ultra low rates currently on offer.
“The volumes we are seeing are very encouraging,” said Tom Lund, Executive Vice President, Single-Family Mortgage Business, in a release.
“A majority of our business volume in March was in refinanced loans, and we anticipate that volumes will increase even more as millions of additional homeowners become eligible to refinance under the President’s Making Home Affordable plan.”
Fannie also disclosed that 500,000 borrowers have accessed the company’s online portal to inquire about the possibility of refinancing under Obama’s program.
Another 80,000 callers have contacted Fannie Mae’s national hotline since the plan was announced.
That could leave even less incentive for some severely underwater homeowners to stick around, despite the low, low rates, leading to more excess inventory.
Low mortgage rates can only do so much.