US Mortgage lenders could originate as much as $2,780bn of new home loans this year, according to industry estimates, as near record low interest rates entice millions of borrowers to refinance their home loans.
The refinancings will reduce monthly payments for borrowers – supporting government efforts to stimulate the economy – and generate new revenue for banks such as Wells Fargo, Bank of America and JPMorgan Chase. Lenders charge fees of between 1 and 2 per cent of the mortgage balance to process new loans.
