Where is the BOOM
In This Post
The Wall Street Journal has some answers
An article in the Wall Street Journal asks why there hasn't been a refinancing boom with interest rates at unprecedented lows. You would think that with rates at 5% and below there would be long lines at the banks. The Journal, of course, goes on to give some reasons. It just isn't getting any easier to deal with these financial giants.
- About 1/4 of all mortgage holders are underwater and would have to bring significant cash to the table to do the refi.
- Higher fees for those that do qualify make it seem not quite worth the hassle.
- Those who have a 1st mortgage and a HELOC would only qualify as a "cash out" refi and then they don't get the good rate.
So the banks may be missing out on some income they could earn by being reasonable. But they're not. Another case of that industry failing to meet the needs of the public. Remember when no one flew because airline ticket prices were just too high.
Maybe someday we'll see real change in the banking industry.