ICE data showed refi retention climbing while affordability and equity reshaped borrower behavior
Refinance borrowers who finally saw some relief on rates in late 2025 did not wait long to act, and servicers that moved quickly were rewarded.
ICE Mortgage Technology’s latest Mortgage Monitor showed refinance retention climbing to its highest level in more than three years as borrowers with recent-vintage loans rushed to cut monthly payments or unlock equity.
In the third quarter, servicers retained 28% of refinancing borrowers, a 3.5‑year high, with more than half of 2024‑book loans kept on the books, according to ICE.
Nonbank servicers significantly outperformed banks, holding on to 35% of refi customers versus 13% for depositories.
Rate-sensitive borrowers drove a refi-heavy uptick
Rate‑and‑term refinances accounted for 62% of all refi activity in October, the highest share in nearly five years, and roughly 95% involved loans originated between 2023 and 2025.
Borrowers in this cohort carried an average balance of about $505,000, with credit scores around 762, and cut their mortgage rate by 0.92 percentage points on average, translating into roughly $200 in monthly savings, ICE said.
“Modest rate relief this fall has driven mortgage application volumes to multi-year highs, showing the outsized impact that incremental affordability improvements have on borrower behavior and servicer retention opportunities,” Andy Walden, head of mortgage and housing market research at ICE, said.
“We’re now seeing the highest concentration of rate-and-term refinances in nearly five years, almost entirely driven by borrowers holding 2023–2025 vintage loans.”
Walden earlier reported that affordability had reached a 2.5‑year high as rates fell, opening more room for both purchase and refinance demand.
Equity tapping, affordability and foreclosure pressures
With millions locked into low first‑lien rates, second‑lien home equity loan withdrawals climbed to their strongest level since 2007 in the third quarter, ICE reported, as borrowers favored HELs and HELOCs over full first‑mortgage refinances.
By mid‑November, average mortgage rates near 6.25% put the monthly principal‑and‑interest payment on a median‑priced home at roughly $2,126, or 29.7% of median household income. That's the best affordability reading since early 2023.
Tim Bowler, president of ICE Mortgage Technology, previously said that “as affordability improves and homeowners gain the ability to refinance, lenders and servicers need to be ready to act quickly.”
At the same time, ICE data showed foreclosure starts and sales ticking higher from very low bases, driven largely by FHA and VA loans, even as overall delinquency rates remained below pre‑pandemic levels.
“ICE’s 2025 Borrower Insights Survey found that 78% of borrowers only shop one or two options before choosing a lender,” Bowler said, adding that in a sensitive rate environment “this limited shopping behavior amplifies the importance of being first to reach motivated borrowers.”
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