Home Equity Lending News

2023 Home-Equity Originations Forecasted to Jump 24%

A national credit forecast for next year has annual home-equity production climbing by nearly a quarter from this year.

By the time 2022 is finished, a projected 2.7 million home-equity lines of credit and home-equity loans will have been originated, according to TransUnion’s 2023 Consumer Credit Forecast.

Second-mortgage business ascended from 2021, when 1.9 million HELOCs and HELs were originated.

TransUnion forecasts that home-equity production will climb to 3.7 million units in 2023 — a 24 percent year-over-year increase.


“Currently, homeowners have over $600 billion in non-mortgage debt, and this is anticipated to increase in 2023 as inflation takes its toll on consumer wallets,” TransUnion Mortgage Business Leader Joe Mellman stated in the release. “Homeowners can considerably reduce their monthly expenses by tapping their home equity to pay off existing debt.”

Tappable home equity is expected to decrease to a forecasted $18.1 trillion as of the fourth-quarter 2023 from an expected $19.4 trillion at the end of this year.

The  drop in tappable home equity was attributed to a decline in home prices in conjunction with falling balances due to pay down rates, though the amount of available equity remains sizable.

“As tappable home equity grew to record highs of nearly twenty trillion dollars in 2022, a dramatic increase in homeowners have taken advantage of this and this trend is expected to continue into 2023,” Mellman said.

Delinquency of at least 90 days on HELOCs finished the third quarter at 0.24 percent, while serious HEL delinquency was 0.83 percent. Both rates have not varied much over the past five years.