I would hope that fewer cash-outs mean that home owners are realizing that they should not take anything out right now, and not that they couldn’t due to the decline in value. But, see below:

Fewer Home Owners Take Home Equity
The number of cash-out refinancings fell to a three-and-a-half-year low, Freddie Mac said Friday.

Cash-out refinancings totaled $37.8 billion in the fourth quarter of 2007, down from $77 billion in the same time frame a year ago.

“This is real evidence of the upset in the mortgage credit markets as well as the impact of the decline in home values that occurred late in the year,” Amy Crews Cutts, Freddie Mac’s deputy chief economist, said in a statement.

“Research conducted by Fed economists suggests that consumers are more sensitive to changes in their home equity than to changes in stock market wealth,” Cutts said. Less home equity will likely have a dampening effect on spending, she added.

Source: Reuters News (02/08/08)