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Abstract
We develop a unique paired loan dataset containing information on multiple conventional conforming mortgage loans to examine home equity extraction decisions over the 2000–2006 period. The main question addressed is how much households borrow when refinancing their current mortgage debt in cash-out transactions and what factors affect that decision. We also provide estimates of the marginal effect of certain borrower characteristics. Results contribute both to the literature on refinancing behavior and the role of house price appreciation in providing funds that may be used for consumer spending or other purposes.