How lower mortgage rates impact homeowners
Lower mortgage rates allow homeowners the opportunity to refinance and lower their debt
Lower mortgage rates may give borrowers a chance to save money.
“This opportunity today allows lots of homeowners to refinance, to lower their household debt and the carry that it has in this market could be the biggest of our history as far as refinancing,” loanDepot CEO Anthony Hsieh told FOX Business’ Neil Cavuto.
WHAT THE CORONAVIRUS OUTBREAK MEANS FOR HOME LOANS, MORTGAGE RATES
However, Hsieh noted that as customers start to become aware of lower interest rates, supply and demand may become a challenge. If interest rates stay down, the mortgage industry could be headed toward a $4 to $5 trillion demand market.
“At the end of the day, there's just not enough money or bodies to go around to handle all the applications that are coming in,” he said. “I think there is something that I think we need to be watching here, because the demand will surpass the supply or the capacity in our industry.”
A sign stands outside a home for sale in southeast Denver on Oct. 22, 2019. (AP Photo/David Zalubowski, File)
GET FOX BUSINESS ON THE GO BY CLICKING HERE
As a result, Hsieh said, the typical 30- to 45-day closing cycle could be stretched out to more than 90 days.
“A customer just needs to be well-prepared and be patient because at the end of the day, you know, refinancing or a mortgage loan is still pretty complex. Although technology has helped a lot, there's still quite a bit of work to be done,” he said.