Bloomberg Law
Aug. 1, 2019, 3:53 PM

Cash-Out Mortgage Refinancings Hit Hurdle as U.S. Tightens Rules

Austin  Weinstein
Austin Weinstein
Bloomberg News

The Trump Administration is shrinking the amount of cash-out mortgage refinancing allowed through the U.S. Department of Housing and Urban Development, looking to reduce risk amid an increase in borrowers using their homes as piggy banks.

The Federal Housing Administration will cut the maximum loan-to-value ratio it allows for refinancing to 80% from 85%, according to a statement released by HUD on Aug. 1. That gives the FHA, which offers loans to first-time and minority homebuyers, the same cash-out limits as Fannie Mae and Freddie Mac.

“We are taking another important step to support sustainable homeownership that builds wealth for ...

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