TransUnion: Four in Five Homeowners Say Their Mortgage Payments Strain Their Finances

(Illustration: TransUnion)

A new survey from TransUnion, Chicago, found that many consumers feel their mortgage payments are putting a strain on their household finances, and the prospect of falling interest rates has them ready to consider refinancing those loans.

TransUnion’s survey found four in five homeowners say their mortgage payments are straining their finances and are looking to refinance their mortgage payments in the next 12 months.

“We surveyed consumers to better understand the drivers of refinance for both mortgages and auto loans,” said Jason Laky, executive vice president and head of financial services at TransUnion. “Millions of people financed homes and autos during this period of high interest rates, and many will look to refinance as interest rates decline.”

When asked the biggest factor that would ultimately drive them to pull the trigger on a refinancing decision, 70% said that a more favorable loan term would be a key driver for them. However, a nearly identical percentage said that better interest rates (67%) and a cash-out refinance (61%) would also be significant drivers, reflecting broad economic interest.

“For many consumers, their mortgage payment is their largest single payment each month and the one that seemingly strains their budget the most,” said Satyan Merchant, senior vice president and mortgage and auto business leader for TransUnion. “The upside is that it is a payment that can be refinanced if the economic climate allows for it, and with interest rates at long last beginning to fall, consumers should begin exploring this option. Conversely, lenders should be actively marketing to these refinance candidates, regardless of what their primary motivation to refinance may be.”