Working 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 housing equity that many have accumulated in recent years.

Keywords: government-sponsored enterprises; refinancing; business cycles;

JEL Classification: R30; R38;

https://doi.org/10.26509/frbc-wp-202021

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Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Working Papers

Publication Date: 2020-07-08

Number: 202021