The boom in refinancing of conventional mortgages has shown signs of slowing, some analysts said, but a wave of home equity refinancings may depress prices in a segment of the the struggling market for mortgage-backed securities and make it harder for investors to predict prepayments.

While the lending industry has enjoyed heavy refinance activity since January because of lower interest rates, investors in mortgage-backed securities have not been so lucky. Refinancings have hurt the bond market by accelerating the speed at which loans are paid before their maturity, which in turn leaves investors less revenue than expected from the bonds and forces them to find other ways to invest their capital.

Analysts say they expect conventional refinancings and prepayment speeds to slow, because the industry is running out of borrowers seeking to cut their mortgage costs.

“I personally think that interest rates stabilized a few months back” and “therefore we are starting to see the end of the refi boom,” said Gary Gordon, a managing director at UBS Warburg Equity Research. “At any given level of rates, there are only so many people willing to refinance.”

However, Jim Waters, a senior vice president at Keefe, Bruyette & Woods Inc., said home equity loan volume is surging as homeowners seek to generate cash by taking advantage of rising real estate values.

A study released Wednesday by Mortgage Guaranty Insurance Corp. said that as many as half of borrowers currently refinancing are doing so to consolidate debt.

Mr. Waters said that this gradual shift in borrower activity is quickening prepayment speeds in older, lower-rate loans that borrowers usually are not motivated to refinance.

“These loans were not economically refi-able, because of rates,” Mr. Waters said. “What we think is at work here is that borrowers are actually taking accumulated equity out of their homes.”

Modeling prepayment risk for refinance booms generally involves looking at the behavior of borrowers who have loans that were issued at rates higher than those currently in the market. But interest rates usually do not sway home equity loan decisions, which are based on the individual borrowers’ cash needs and home values.

This means it will be harder for investors to determine which mortgage bonds will suffer lower prices as a result of higher prepayment speeds. Hence it may be harder for them to make the necessary adjustments in their investment portfolios.

Arthur Frank, director of mortgage research for Nomura Securities, said that, while home equity behavior is specific to each borrower’s needs, investors will have to start including home price indexes in their models for prepayment behavior.

To be sure, not all experts believe the refinance boom is dead.

Orawin Velz, Fannie Mae’s senior economist, said it is “by no means over” and predicted “there will be a new wave of refinancing” once fence-sitters waiting for interest rates to bottom out realize these rates will not get any lower.

Mr. Frank pointed out that, while prepayment speeds in Fannie Mae and Freddie Mac MBS did not rise as much in May as in previous months, they are still increasing.

“As long as the housing market remains robust,” he said, “we expect to see a continuation of fast speeds in seasoned current coupons and slight premium pools.”

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