Percentage of Purchase Loans Increases to 87 Percent, Driving Time to Close Up, According to February Ellie Mae Millennial Tracker
PLEASANTON, Calif. – April 3, 2019 – As U.S. housing trends toward a buyer’s market, purchases accounted for 87 percent of all closed loans for the month of February, a slight uptick from 85 percent in January, according to the latest Ellie Mae Millennial Tracker™. Refinances fell two percentage points to 11 percent of all loans to Millennial borrowers. While they remained the most popular loan product among Millennial borrowers, share of Conventional loans slightly decreased from the month prior, representing 68 percent of all loans.
The time for Millennial borrowers to close Conventional loans peaked in February to 46 days on average, up from 44 days the month prior and the longest average time to close since January 2017. Among Conventional loans closed by Millennials in February, it took 44 days on average to close a purchase (up from 42 days in January) and 53 days on average to close a refinance (up from 44 days the month prior).
Conversely, the average time to close all loans decreased from 44 days in January to 42 days in February. During the same period, average time to close FHA loans decreased slightly to 42 days from 44 days in January, while average time to close VA loans increased from 53 days to 59 days month-to-month.
“The percentage of purchase loans is on the rise with Millennials continuing to enter the homebuying market for their first or maybe even second purchase,” said Joe Tyrrell, executive vice president of strategy and technology for Ellie Mae. “The increase in days-to-close we saw in February is relative to the percentage increase in purchases versus refinances, as purchases typically take longer to close.”
FICO scores across all loan types slightly increased in February to an average of 723, up from 722 in January. For purchases, the average FICO score was 745 for a Conventional loan, 678 for an FHA loan and 740 for a VA loan.
In February, the hottest housing markets for Millennials were in the affordable Midwest. The top markets by percentage of Millennial loans closed were Mitchell, S.D. (100 percent), Fort Morgan, Colo. (94 percent), and Jasper, Ind. (86 percent).
Ellie Mae® (NYSE: ELLI) is the leading cloud-based platform provider for the mortgage finance industry.
The Ellie Mae Millennial Tracker is an interactive online tool that provides access to up-to-date demographic data about this new generation of homebuyers. It mines data from a robust sampling of approximately 80 percent of all closed mortgages dating back to 2014 that were initiated on Ellie Mae’s Encompass® all-in-one mortgage management solution. Given the size of this sample and Ellie Mae’s market share, it is a strong proxy of Millennial mortgage indicators across the country. Searches can be tailored by borrower geography, age, gender, marital status, FICO score and amortization type.
For more information, visit http://elliemae.com/millennial-tracker.
About the Ellie Mae Millennial Tracker
The Ellie Mae Millennial Tracker focuses on Millennial mortgage applications during specific time periods. Ellie Mae defines Millennials as applicants born between the years 1980 and 1999. New data is updated on the first Monday of every month for two months prior. The Millennial Tracker is a subset of our Origination Insight Report, which details aggregated, anonymized data pulled from Ellie Mae’s Encompass origination platform. Additional information regarding the Origination Insight Report can be found at http://elliemae.com/resources/origination-insight-reports. News organizations have the right to reuse this data, provided that Ellie Mae, Inc. is credited as the source.
About Ellie Mae
Ellie Mae (NYSE:ELLI) is the leading cloud-based platform provider for the mortgage finance industry. Ellie Mae’s technology solutions enable lenders to originate more loans, reduce origination costs, and shorten the time to close, all while ensuring the highest levels of compliance, quality and efficiency. Visit EllieMae.com or call 877.355.4362 to learn more.
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