More homeowners are refinancing to take equity out through a cash-out tranaction. They’re then using the extra cash to pay down credit card debts, renovate their home, or even invest in a new home.

Over the past two years that has resulted in a large number of homeowners who are taking on higher interest rates via refinancing. Still, owners say that the mortgage rates are lower than what they would have to pay through a credit card or home equity line of credit.

Homeowner Paul Thompson was undeterred by the higher rates through a cash-out refi. He told The Wall Street Journal that when he purchased his Dallas home in 2015, he was able to get a mortgage at 4%. But at the end of last year, he refinanced at 4.625% and took out about $30,000 in equity from his home. He says the higher rate was worth it because it gave him extra cash to renovate an investment property next door.

But the greater use of cash-out refinancings has some economists concerned that homeowners will be tempted to use their homes like ATMs, as they were blamed on doing in the years leading up to the housing crisis. Consumers who struggle to pay their mortgages from a cash-out refinancing are at risk of losing their homes. On the other hand, the economists note, credit card debt is unsecured.

Still, others are quick to note that cash-out refinancings are well below pre-crisis levels.

Also, cash-out refinancings are becoming more enticing compared to home equity lines of credit. The Wall Street Journal reports that the 30-year fixed-rate mortgage has dropped at a much faster pace than HELOC rates this year. The two are based on different benchmark rates. For example, this fall, 30-year mortgage rates were nearly 3 percentage points lower than the average HELOC rate, according to Bankrate.com.

A recent study shows that the use of algorithms for online mortgage lending may actually help reduce discrimination against some minority groups. The study, conducted by the National Bureau of Economic Research, calls for banks to embrace more artificial intelligence tools to help end bias in home loans and lending decisions.

According to the study, mortgage lenders reject minority applicants, on average, at a rate that is 6% higher than those with comparable economic backgrounds during in-person meetings. But when applicants complete online applications, the acceptance and rejection rates were essentially the same, the study showed.

“If we look at banks, they have argued in the past that they’re in a bind when staring down potentially conflicting government mandates to reduce balance sheet risk, while not discriminating against any one demographic group,” a Forbes.com article reports.

The disparities in homeownership rates are often cited as the main culprit behind the racial wealth gap.

Homeownership among African Americans has plunged to its lowest level, at 40%, and has been gradually declining since peaking in 2004, according to U.S. Census Bureau data. From 2009 to 2015, up to 1.3 million minority loan applicants were rejected, the National Bureau of Economic Research estimates.

Researchers point to artificial intelligence as one possible way to reverse that trend. Lenders embracing AI and online mortgage platforms say they’ve seen a fivefold increase in Hispanic and African American borrowers between the ages of 30 and 40 over the last year.

Still, “the growing use of algorithms in financial services can produce results that are positive, negative, or simply unpredictable,” Forbes.com reports. “It’s important to note that 45% of the country’s largest mortgage lenders now offer online or app-based loan origination, as FinTech looks to play a major role in reducing bias in the home lending market.”

More home shoppers purchased newly constructed homes in November, bringing new-home sales to their best three-month performance since 2007, the U.S. Commerce Department reported Monday. Economists credit low mortgage rates, low unemployment, and strong income growth for the sales uptick.

Sales of new single-family homes increased 1.3% to an annualized pace of 719,000 in November. “Fueled by the limited number of resales available for purchase, low interest rates, and low unemployment, new home sales are finishing the year strong,” says Greg Ugalde, chairman of the National Association of Home Builders. New-home sales are running 10% higher than in 2018. Plus, builder confidence is high, indexes show, which bodes well for 2020, adds NAHB Chief Economist Robert Dietz.

Low inventory of new homes, however, continues to put pressure on prices. The median sales price of a new home rose 7.2% compared to a year ago, reaching $330,800 in November. Inventory of new homes stand at a 5.4-month supply. There are 323,000 new single-family homes for sale (but just 76,000 are completed and ready to occupy).

New home sales are performing strongest in the South, up 14.5% from a year ago in November, followed by a 12% increase in the West. In the Northeast and Midwest, meanwhile, new-home sales are down 10.4% and 7.6%, respectively.

Inventory remains a pressing issue for the overall housing market in both the new-home and existing-home markets. Lawrence Yun, chief economist at the National Association of REALTORS®, says that housing starts are short by 135,000 compared to the long-term average—and well short of the 5 million to 6 million that is needed to fully end the housing shortage.

“More home construction appears to be on the way as we move into 2020, as reflected in the very high confidence of home builders,” Yun said last week. “They are clearly recognizing an improving business opportunity. Overall, more construction will mean more housing inventory to choose from for consumers. Home sales can then easily rise while taming the fast growth in home prices.”

Last week, NAR also released a report that showed sales of previously owned homes fell in November, likely due to inventory constraints. Yun said existing-home sales likely will be “choppy when inventory levels are low,” but a strong economy should help keep demand strong.