Overall Time to Close a Loan Drops to 44 Days in February, with Decreased Days to Close Across All Loan Types
PLEASANTON, Calif. April 05, 2017 — In February, time to close all loans for Millennial borrowers decreased to 44 days, the shortest average time to close since March 2016, according to the latest Millennial Tracker™ released by Ellie Mae® (NYSE:ELLI), a leading provider of innovative on-demand software solutions and services for the residential mortgage industry. The average time to close a purchase loan for Millennials decreased from 46 days in January to 42 days in February, while time to close a refinance loan also decreased to 52 days in February, down from 58 days the month prior. Similarly, the average time to close FHA loans decreased from 47 days in January to 43 days in February. Average time to close VA loans decreased dramatically from 57 days to 41 days.
As U.S. housing trends toward a buyer’s market, purchases accounted for 86 percent of all closed loans for the month of February, a slight uptick from 84 percent in January, while refinances fell two percentage points to 14 percent of all loans to Millennial borrowers. Share of conventional loans stayed steady from the month prior, representing 61 percent of loans, while FHA loans increased to 36 percent in February, up from 35 percent the month prior.
FICO scores across all loan types continued to fall in February to an average of 723, down from 724 in January and their peak of 726 from August through October 2016. For purchases, the average FICO score was 747 for a conventional loan, 690 for an FHA loan and 745 for a VA loan.
“Purchase loans are increasing, indicating that Millennials are continuing to enter the first-time homebuyer market,” said Joe Tyrrell, executive vice president of corporate strategy for Ellie Mae. “In addition, we saw time to close decrease from 49 days in January to 44 days in February, which indicates that our lenders are seeing more efficiency as they embrace mortgage automation.”
In February, the hottest housing market for Millennials was in the state of Texas. The top markets by percentage of Millennial loans closed in the state included Odessa, Midland and Beaumont-Port Arthur.
Ellie Mae® (NYSE:ELLI) is a leading provider of innovative on-demand software solutions and services for the residential mortgage 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 75 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 Millenial 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 a leading provider of innovative on-demand software solutions and services for the residential mortgage industry. Mortgage lenders of all sizes use Ellie Mae’s Encompass® all-in-one mortgage management solution, Mavent Compliance Service, and AllRegs research, reference and education resources to improve compliance, loan quality and efficiency across the entire mortgage lifecycle. Visit EllieMae.com or call 877.355.4362 to learn more.