February Origination Insight Report From Ellie Mae Shows Time to Close Shortens in February as Interest Rates Continue to Rise
This comes as 30-year interest rates continue to rise from 4.330 in January to 4.480 in February, the highest rate since May of 2014. The percentage of closed ARMs held at 5.5 percent for the second month.
Closing rates decreased slightly, with closing rates on all loans decreasing from 70.9 percent to 70.6 percent and closing rates on refinances decreasing from 65.5 percent to 65.0 percent. Closing rates on purchases held at 75.7 percent for the second month.
“As expected, we are seeing the percentage of refinances taper back off
to the projected industry levels,” said
Other statistics of note in February included:
- The percentage of refinances dropped from 45 percent of all closed loans in January to 43 percent of all closed loans in February. The percentage of purchases increased to 57 percent of total closed loans.
- The breakdown of type of loans remained the same for the second month with FHA loans representing 19 percent of closed loans, conventional loans representing 67 percent and VA loans representing 10 percent.
- Overall FICO scores held steady at 721 for the second month. LTV increased from 77 to 78 and DTI held at 26/40.
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 FEBRUARY 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 FEBRUARY 2018
|Closed First-Lien Loans
|FICO Score (FICO)||721|
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 that have closed over the past year. 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