Question by Nathan: What are the economic implications of a massive wave of refinancing by homeowners to lower rates?
If interest rates were to drop significantly more, say 30 YR fixed to sub 3%, and a huge percentage of homeowner mortgages are refinanced, what implications does this have on the broader economy, e.g. money supply, inflation, etc?
Answer by SDD
It would mean less interest being paid each month, which would mean households would have more money to spend on other things.
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