alt Hacker News> There's lots of speculation that mortgage rates will have to increase if people use AI agents to start optimally refinancing their mortgages
What does “optimally refinancing” mean?? Really. This sounds like spreading FUD.
A perfect decision about financing would need to know future interest rates and how long you will stay in the house.
You don't need to know if a decision is perfect to decide if it is sub-optimal. You think that rational inattention is FUD and that all borrowers pay attention to mortgage rates constantly?
You start with the 20% of mortgagees that completely fail to refinance even though it would save them money [1] and then move on the other 17% that wait too long to refinance and then the 52% that do so at the wrong rate by using rules of thumb instead of more sophisticated models. [2]
If you'd like to better understand this "FUD", Matt Levine is a much better write than I am: https://archive.is/WljUV
[1] https://www.nber.org/papers/w20401 [2] https://www.econstor.eu/bitstream/10419/96658/1/74522380X.pd...