Mortgage market narratives can spark anxiety when taken out of context. While many so-called myths contain a kernel of truth, they are often misunderstood without historical context.
Two themes currently fueling concern among mortgage market professionals are a perceived surge in cash‑out refinancing and a wave of delinquencies. 
One narrative raising alarms is that cash-out refinances — and home equity extraction more broadly — are surging. The concern is that borrowers will drain their equity, leaving themselves financially vulnerable if they struggle to make monthly mortgage payments. 
The facts are more nuanced. Cash-out refinances accounted for 17% of total mortgage originations in the fourth quarter of 2025, up from 15% a year earlier...