|
According to a study commissioned by the
Homeownership Alliance of Washington, DC, the recent boom in mortgage
refinancing has accounted for 20% of the real growth in the U.S.
economy since 2001.
According to Mark Zandi, who led the study,
the recession would have been much more severe without the drop in
interest rates and the refinancing that followed.
"Since the refinancing boom began two years
ago, close to $2.5 trillion in mortgage debt has been refinanced,"
Zandi said. "That's nearly half of all mortgage debt
outstanding."
Zandi is the chief economist and co-founder
of Economy.com.
"Even if the mortgage rates do rise in
2003, the economic benefits of the current refinancing activity will
linger on for some time," he said. "The refinancing boom is largely
responsible for allowing households to insulate themselves from the
potential negative financial impact of higher interest
rates."
Homeownership Alliance president, Rick
Davis, noted, "While the stellar economic contribution of housing
during this economic downturn has been well documented, the
contribution of refinancing activity has not. This new study examines
a crucial element of the housing industry that is having a profound
effect on the economy. Refinancing positively impacts individual
homeowners by providing a method of raising cash in difficult economic
times."
In a separate study that shows the
industry's recent contribution to the economy, the Mortgage Bankers
Association of America estimated that mortgage industry employment has
grown 37% since 2001, creating 110,000
jobs. | 
.JPG)
