by Tanta on 8/28/2007 04:39:00 PM

Here's another little bit of data to fit into the big picture on refinances. It doesn't solve any problems or prove anything conclusively. It's from a Countrywide Capital Markets newsletter that I get (not on the web, I'm afraid.)

What this means is that, of the refinances into a 30-year fixed-rate conforming loan that Countrywide did in the six months prior to December 2005, 3.2% were borrowers refinancing out of an Option ARM. By June 2007, the number had increased to 11.4%.

At the same time, the percent of new FRM refis that were originally subprime seems to be slowing down.

This suggests that the number of subprime borrowers who can refinance into a conforming fixed is decreasing as we get toward a "residual" pool of subprime loans that either do not qualify for a 30-year fixed or whose monthly payment cannot be lowered with one.