LendingTree Report: Refinance Applications Triple in the U.S.

March 25, 2020 at 6:00 AM EDT
LendingTree data reveals that refinance mortgage applications tripled from a year ago in each of the 50 largest cities and in all but five states.

CHARLOTTE, N.C., March 25, 2020 /PRNewswire/ -- LendingTree®, the nation's leading online loan marketplace, released its latest report on the recent growth in refinance applications compared to the same time period in 2019. The economic effects of the COVID-19 coronavirus pandemic have led to unprecedented volatility in mortgage interest rates and an overwhelming surge of borrower demand. LendingTree data shows that refinance mortgage applications through LendingTree's marketplace tripled from a year ago in each of the 50 largest cities and in all but five states.

Key findings

  • San Francisco and Raleigh, N.C., lead cities with the most growth in refinance loan requests, which increased 417% and 406%, respectively.
  • There are four California cities in the top 10. San Jose, San Diego and Los Angeles saw refinance inquiries grow 394%, 360% and 345%, respectively, from last year.
  • Buffalo, N.Y., Louisville, Ky. And Memphis, Tenn. Lag the rest of the nation's metros in refinances. Borrowers in these three cities are taking the least advantage of this historic refinance opportunity, though they still show growth rates above 200%.
  • Nebraska had the fastest growth of all states. Applications were up 338%, leading the nine states with growth rates above 300%.
  • Five states underperform notably. With growth rates below 200%, borrowers in West Virginia, Mississippi, Kentucky, Arkansas and Alabama are missing out on an opportunity to significantly lower their mortgage payments.
  • Home-value appreciation and credit scores matter. When LendingTree compared states, it found correlations to refi-application growth of 0.37 for home-value appreciation growth over five years, and 0.57 for average homeowner credit scores.

"A mortgage refinance, particularly at these historically low rates, presents an attractive opportunity for homeowners amid economic uncertainty," said Tendayi Kapfidze, LendingTree's chief economist. "Compared to a year ago when rates were 1 percentage point higher, consumers save nearly $60 per month — or $700 per year in payments — for every $100,000 borrowed. Interest savings add up to about $20,000 over the 30-year term of a typical mortgage."

States and cities with higher average credit scores and greater home-price appreciation are better positioned to take advantage of the historic refinance opportunity. The improvement in the balance sheets of those households could potentially help some areas recover more robustly when the economic crisis induced by the coronavirus ends.

Year-over-Year Growth in Refinance Requests by Metro

Rank

Metro Area

YoY Refi Growth in Refi Requests

1

San Francisco

417%

2

Raleigh, N.C.

406%

3

San Jose, Calif.

394%

4

Austin, Texas

386%

5

Seattle

371%

6

Washington

366%

7

Charlotte, N.C.

363%

8

San Diego

360%

9

Minneapolis

348%

10

Los Angeles

345%

 

Year-over-Year Growth in Refinance Requests by State

Rank

Metro Area

YoY Refi Growth in Refi Requests

1

Nebraska

338%

2

Washington

326%

3

Alaska

320%

4

Virginia

316%

5

North Dakota

313%

6

Minnesota

309%

7

North Carolina

308%

8

California

307%

9

Montana

304%

10

Nevada

295%

 

Methodology
LendingTree compared consumer mortgage refinance applications in early 2020 to a comparable period in 2019. Applications were submitted on the LendingTree mortgage shopping platform, which includes more than 500 mortgage lenders across the country.

For the full metro and state rankings, please see the full report here: https://www.lendingtree.com/home/refinance/where-refinance-applications-are-growing-fastest/

About LendingTree
LendingTree (NASDAQ: TREE) is the nation's leading online marketplace that connects consumers with the choices they need to be confident in their financial decisions. LendingTree empowers consumers to shop for financial services the same way they would shop for airline tickets or hotel stays, comparing multiple offers from a nationwide network of over 500 partners in one simple search, and can choose the option that best fits their financial needs. Services include mortgage loans, mortgage refinances, auto loans, personal loans, business loans, student loans, insurance, credit cards and more. Through the My LendingTree platform, consumers receive free credit scores, credit monitoring and recommendations to improve credit health. My LendingTree proactively compares consumers' credit accounts against offers on our network, and notifies consumers when there is an opportunity to save money. In short, LendingTree's purpose is to help simplify financial decisions for life's meaningful moments through choice, education and support. LendingTree, LLC is a subsidiary of LendingTree, Inc. For more information, go to www.lendingtree.com, dial 800-555-TREE, like our Facebook page and/or follow us on Twitter @LendingTree. 

MEDIA CONTACT:
Megan Greuling
megan.greuling@lendingtree.com
704-943-8208

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SOURCE LendingTree.com