Borrowers who refinanced their home mortgages during the first six months of this year are expected save more than $2 billion, according to a report that looked at the impact from special government rate cuts and programs.
That was one of the findings from How the U.S. Consumer Has Benefited from Mortgage Finance Programs in 2009, First American CoreLogic reported today.
The study measured the impact of government refinance programs and interest rate cuts by the Federal Reserve on U.S. borrowers. Data was analyzed from more than 2.2 million refinances that closed between October 2008 and June 2009.
Borrowers who refinanced from January through June are projected to save $2.3 billion in payments, while the estimated median monthly savings is $120. Within five years, the total benefit is expected to grow to $11.5 billion.
“The quantitative easing policies of the Federal Reserve and refinance activity made possible by the Home Affordable Refinance Program have allowed more than 2 million consumers to reduce their monthly mortgage debt obligations,” stated Mark Fleming, Ph.D., chief economist for First American CoreLogic. Fleming was the author of the report.
“These refinanced loans are likely to be more sustainably affordable debt obligations,” Fleming added. “The combination of lower payments and fixed-rate terms should also reduce the risk of future foreclosure.”
