Refi drop roils cash-out loans

The amount of money raised by turning home equity into cash fell 51% in the last three months of 2003 from record levels in the third quarter as refinancing dropped to an 18-month low.

A decline in refinancing put the dollar volume of the so-called cash-out loans at $135.6 billion, down from $277.2 billion, the highest on record. The share of refinanced loans with balances at least 5% higher than the original mortgage rose to 45% from 34%, according to a report from mortgage financier Freddie Mac in McLean, Virginia.