Is The Cash Out Refinance Dead?

OK, so we've had a period of increasing real estate values and rates have remained low to allow for a refinance boom. During this boom, there was a large trend of people taking cash out against the equity in their homes, and fortunately the property values were increasing so there was plenty of room to take that cash out. Well, things are beginning to shift. Many real estate markets are beginning to correct. Meaning that the values are beginning to fall due to a surplus of properties. We are seeing some (not a huge amount, but some)of that here in Columbia, MO. So what does that mean for refinanciers? It means there isn't enough value in a lot of properties (relative to the amount owed) to pull any cash out. In some cases, people who did a cash out in the recent past will find themselves owing more on their house than the market will bare. This is called "upside down" in your home. There are still some good opportunities and justifications for refinance, but as property values trickle down, the opportunity to take any equity in your home in the form of cash is dwindling.