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Ellie Mae Releases September 2013 Origination Insight Report

Purchase Loans Share Continues to Grow as Credit Standards Loosen

PLEASANTON, Calif. – October 16, 2013 – Ellie Mae® (NYSE: ELLI), a leading provider of enterprise-level, on-demand automated solutions for the residential mortgage industry, today released its Origination Insight Report for September 2013. The report draws its data and insights from a robust sampling of the significant volume of loan applications—more than 20% of all originations in the United States—that flow through Ellie Mae’s Encompass360® mortgage management software and the Ellie Mae Network™.

MONTHLY ORIGINATION OVERVIEW FOR SEPTEMBER 2013

  September
2013*
August
2013*
6 Months Ago
(March 2013)*
1 Year Ago
(September 2012)*
Closed Loans
Purpose
Refinance 42% 43% 62% 65%
Purchase 58% 57% 38% 35%
Type
FHA 19% 18% 21% 19%
Conventional 70% 70% 70% 72%
Days to Close
All 42 41 46 50
Refinance 40 41 47 53
Purchase 43 42 44 47
ARMs vs. Fixed, Length, Rate
ARM % 5.5% 5.9% 2.5% 2.6%
15 Year % 15.5% 14.6% 15.9% 17.3%
30 Year – Note Rate 4.761 4.618 3.813 3.773
*All references to months should be read as month ended.

PROFILES OF CLOSED AND DENIED LOANS FOR SEPTEMBER 2013

  Closed First-Lien Loans (All Types) Denied Loans
(All Types)
FICO Score (FICO) 732 696
Loan-to-Value (LTV) 81 84
Debt-to-Income (DTI) 25/37 28/45
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 (i.e., the June 2013 applications) to calculate an overall closing rate of 52.3% in September 2013, down from 53.1% in August 2013 (see full report).

“The share of purchase loans continued to grow in September 2013, climbing 1% to 58% of all loans even in the face of higher interest rates and seasonality,” said Jonathan Corr, president and chief operating officer of Ellie Mae. “This was the eighth consecutive month that the purchase loan percentage has increased or stayed steady. In January 2013, purchases represented only 27% of closed loans.

“The credit standards also continued to ease in September with average FICO scores for closed loans dropping to 732 compared to 734 in August. September’s averages were 15 points below where they were at the beginning of the year (January 2013) and the lowest level since we began our tracking in August 2011,” noted Corr. “When you drill down farther, the change is even more apparent. For example, 31% of the closed loans in September 2013 had FICO scores under 700 compared to 17.46% of closed loans in September 2012.

“Similarly, debt-to-income ratios rose again slightly last month,” Corr said. “DTIs went from 24/37 in August to 25/37 in September 2013.”

About Ellie Mae Origination Insight Report

In 2012, the total volume of mortgages that ran through Ellie Mae’s Encompass360 mortgage management software was approximately three million loan applications, or 20% of all U.S. mortgage originations. The Origination Insight Report mines its application data from a robust sampling of approximately 44% of all mortgage applications that were initiated on the Encompass origination platform. Given the size of this sample and Ellie Mae’s market share, the Company believes the Origination Insight Report is a strong proxy of the underwriting standards that are being employed by lenders across the country.

The Origination Insight Report focuses on loans that closed or were denied in a specific month and compares their characteristics to similar loans that closed or were denied three and six months earlier. 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 nonqualification.

The Origination Insight Report details aggregated, anonymized data and does not disclose client-specific or proprietary information.

News organizations have the right to reuse this data, provided that Ellie Mae, Inc. is credited as the source.

About Ellie Mae

Ellie Mae, Inc. (NYSE: ELLI) is a leading provider of on-demand automation solutions for the mortgage industry. The Company offers an end-to-end solution, delivered using a Software-as-a-Service model that serves as the core operating system for mortgage originators and spans customer relationship management, loan origination and business management. The Company also hosts the Ellie Mae Network™ that allows Encompass® users to electronically conduct business transactions with the lenders and settlement service providers they work with to process and fund loans. The Company’s offerings include the Encompass, Encompass360® and DataTrac® mortgage management software systems.

Ellie Mae was founded in 1997 and is based in Pleasanton, California. To learn more about Ellie Mae, visit www.EllieMae.com or call 877.355.4362.

© 2013 Ellie Mae, Inc. Ellie Mae®, Encompass®, Encompass360®, DataTrac®, Ellie Mae Network™ and the Ellie Mae logo are registered trademarks or trademarks of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.

PRESS CONTACT

Bill Campbell
Campbell Lewis Communications
212.995.8057
bill@campbelllewis.com

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