December Origination Insight Report From Ellie Mae Shows Adjustable Rate Mortgage Usage Hits Eight-Year High as Consumers Compete for Homes
The increase in ARMs continues to be correlated to the 30-year rate, which rose to 5.17 for loans closed in December, up from 5.15 the month prior. For FHAs, the 30-year rate increased to 5.20, Conventional rates increased to 5.19 and VA rates rose to 5.01.
“With the strong demand for housing and the rapid increase in property
value appreciation, more consumers are turning to Adjustable Rate
Mortgages in order to gain additional flexibility when competing for a
Other statistics of note in December included:
- The time to close all loans increased to 47 days in December, up from 46 days in November. Time to close a purchase loan decreased to 47 days, while time to close a refinance increased to 44 days.
- The percentage of purchase loans rose to 71 percent of total loans in December, up from 70 percent the month prior.
- Overall FICO scores dropped one point to 726. LTV held at 79 for the fifth month and DTI held at 26/39.
The Origination Insight Report mines data from a robust sampling of approximately 80 percent of all mortgage applications that were initiated on the Encompass® all-in-one mortgage management solution. Ellie Mae believes the Origination Insight Report is a strong proxy of the underwriting standards employed by lenders across the country.
In addition to the Origination Insight Report, Ellie Mae also distributes data from its monthly Ellie Mae Millennial Tracker on the first Wednesday of each month. The Ellie Mae Millennial Tracker focuses on mortgage applications submitted by borrowers born between the years 1980 and 1999.
MONTHLY ORIGINATION OVERVIEW FOR DECEMBER 2018
|Dec. 2018*||Nov. 2018*||6 Months Ago
|1 Year Ago
|Days to Close|
|Percentage of ARM and Fixed Loan Volume|
*All references to months should be read as month ended.
PROFILES OF CLOSED LOANS FOR DECEMBER 2018
|Closed First-Lien Loans
|FICO Score (FICO)||726|
More information and analysis of closed and denied loans by loan purpose and investor are available in the full report at http://www.elliemae.com/about-us/news-reports/ellie-mae-reports/.
To get a meaningful view of lender pull-through, Ellie Mae reviewed a
sampling of loan applications initiated 90 days prior—or the
About the Ellie Mae Origination Insight Report
The Origination Insight Report focuses on loans that closed in a specific month and compares their characteristics to similar loans. The closing rate is calculated on a 90-day cycle rather than on a monthly basis because most loan applications typically take one-and-a-half to two months from application to closing. Loans that do not close could still be active applications or applications withdrawn by consumers or denied for incompleteness or non-qualification.
The Origination Insight Report details aggregated, anonymized data pulled from Ellie Mae’s Encompass origination platform.
News organizations have the right to reuse this data, provided that
About Ellie Mae
Ellie Mae, Inc.