This new record is 26% higher than at the height of the housing bubble.

Tappable equity reached an all-time high of $6.3 trillion in the second quarter as home-price gains made real estate more valuable. The amount of equity homeowners could borrow against before hitting the 80% loan-to-value limit imposed by most lenders rose by $335 billion during the three-month period, according to Black Knight. The new record high is 26% above the 2006 peak in the midst of the housing bubble. The average owner with tappable equity has $140,000 available to borrow against, Black Knight said. About 55% have interest rates that are at least 0.75% higher than current rates and have credit scores at or above 760, the mortgage data firm said. “Nearly half of the 45 million homeowners with tappable equity have 1st lien interest rates at or above 4.25%, making refinancing an attractive option,” Black Knight said in a statement. The increase in tappable equity slowed in 2018 as higher rates chilled the pace of home-price gains. Higher financing costs typically reduce the size of loans borrowers can get because they’re qualified based on their ability to make the monthly payments, which go up as financing becomes more expensive. 

Source: HousingWire