Discussion Paper

Evaluating the Benefits of a Streamlined Refinance Program


Abstract: Mortgage borrowers who have experienced employment disruptions as a result of the COVID-19 pandemic are unable to refinance their loans to take advantage of historically low market rates. In this article, we analyze the effects of a streamlined refinance ("refi") program for government-insured loans that would allow borrowers to refinance without needing to document employment or income. In addition, we consider a cash-out component that would allow borrowers to extract some of the substantial amount of housing equity that many have accumulated in recent years.

Keywords: mortgage; refinance; cash-out; COVID-19;

JEL Classification: G28; G51; R38;

https://doi.org/10.29338/ph2020-08

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Bibliographic Information

Provider: Federal Reserve Bank of Atlanta

Part of Series: Policy Hub

Publication Date: 2020-06-25

Number: 2020-08