Press Release

Percentage of Refinances Surpasses Half of all Closed Loans in October According to Latest Ellie Mae Origination Insight Report

PLEASANTON, Calif. – Nov. 20, 2019 – According to the October Origination Insight Report from Ellie Mae®, the leading cloud-based platform provider for the mortgage finance industry, the percentage of refinances accounted for 51 percent of closed loans in the month, which is the highest percentage of refinances since March 2015. Purchases accounted for 49 percent of total closed loans, dropping two percentage points from the month prior.

This comes as interest rates tick up slightly, with the 30-year note rate increasing to 3.94 percent for all closed loans, up from 3.93 percent in September. The 30-year note rate for FHA loans decreased slightly from 3.96 percent in September to 3.94 percent in October while the 30-year note rate for Conventional loans increased from 3.96 percent in September to 3.98 percent in October.

Other statistics of note in October included:

  • The time to close all loans rose slightly to 44 days in October, up from 43 days in September. The time to close refinances increased to 42 days, up from 39 days the month prior and the time to close purchases jumped one day to 47 days.
  • The percentage of Adjustable Rate Mortgages (ARMs) on all loans increased to 5.0 percent, up from 4.7 percent the month prior.
  • Closing rates on all loans held at 78.1 percent for the second consecutive month.

“Interest rates continued to decline in October which had homeowners reaching out to lenders as they look to save on their monthly mortgage payments,” said Jonathan Corr, President and CEO of Ellie Mae. “We are seeing refinances surpass 50 percent of closed loans, which is proof that homeowners are taking advantage of the opportunity to lock in lower rates.”

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 OCTOBER 2019

  Oct. 
2019*
Sept.
2019*
6 Months Ago
(Apr. 2019*)
1 Year Ago
(Oct. 2018*)
Closed Loans
Purpose
Refinance 51% 49% 35% 32%
Purchase 49% 51% 65% 68%
Type
FHA 16% 16% 20% 19%
Conventional 73% 71% 64% 65%
VA 8% 9% 10% 10%
Days to Close
All 44 43 40 45
Refinance 42 39 33 43
Purchase 47 46 43 46
Percentage of ARM and Fixed Loan Volume
ARM % 5.0% 4.7% 6.8% 8.2%
30-Year Rate
Average 3.94% 3.93% 4.61% 5.01%

*All references to months should be read as month ended.

PROFILES OF CLOSED AND DENIED LOANS FOR OCTOBER 2019
  Closed First-Lien Loans (All Types)
FICO Score (FICO) 737
Loan-to-Value (LTV) 77
Debt-to-Income (DTI) 24/37

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 July 2019 applications—to calculate an overall closing rate of 78.1 percent in October 2019 (see full report).

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 closed 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 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 Ellie Mae, Inc. is credited as the source.

About Ellie Mae

Ellie Mae 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.

PRESS CONTACT

Erica Bigley
Ellie Mae, Inc.
(925) 227-5913
Erica.Bigley@elliemae.com

Caitlin Coffee
Allison+Partners
(312) 635-8204
EllieMae@allisonpr.com

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© 2019 Ellie Mae, Inc. Ellie Mae®, Encompass®, AllRegs®, Mavent®, Velocify®, the Ellie Mae logo and other trademarks or service marks of Ellie Mae, Inc. appearing herein are the property of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.

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