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Lenders’ share of purchase volume picks up in March, according to latest Ellie Mae Origination Insight Report
PLEASANTON, CA (May 1, 2015) – Lenders’ share of mortgage purchase volume increased for the first time in 2015, jumping 5 percent according to the latest Origination Insight Report released by Ellie Mae® (NYSE:ELLI), a leading provider of innovative on-demand software solutions and services for the residential mortgage industry. Purchases represented 46 percent of lenders’ overall volume in March, compared to 53 percent in mortgage refinancing volume, the report found.
According to the report, the average 30-year fixed mortgage rate in March rose to 4.041%, a slight increase of .033% over February’s rate of 4.008%. Meanwhile, the closing rate for all loans climbed more than 3 percent between February and March, while average days to close for all loans in March was 44 days.
“As many anticipated, purchase loan activity is gaining momentum as the housing market enters the peak spring buying season,” said Jonathan Corr, president and CEO of Ellie Mae. “This, along with the slightly higher than expected origination volume the industry is seeing, likely contributed to the rise in days to close.”
The Origination Insight Report mines its application data from a robust sampling of approximately 66 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.
Other findings of the March 2015 Origination Insight Report include:
- Average FICO score on a closed loan dipped one point to 731.
- Share of FHA refinances at 95 LTV climbed to above 40 percent
MONTHLY ORIGINATION OVERVIEW FOR MARCH 2015
| March 2015* | February 2015* | 6 Months Ago(Sept. 2014*) | 1 Year Ago(March 2014*) | |
| Closed Loans | ||||
| Purpose | ||||
| Refinance | 53% | 59% | 36% | 40% |
| Purchase | 46% | 41% | 63% | 60% |
| Type | ||||
| FHA | 22% | 19% | 19% | 22% |
| Conventional | 66% | 69% | 64% | 65% |
| VA | 9% | 9% | 12% | – |
| Days to Close | ||||
| All | 44 | 38 | 41 | 40 |
| Refinance | 45 | 36 | 40 | 37 |
| Purchase | 44 | 40 | 41 | 41 |
| Percentage of ARM & Fixed Loans | ||||
| ARM % | 4.2% | 4.0% | 6.3% | 7.4% |
| 15 Year % | 11.1% | 11.1% | 9.1% | 12.4% |
| 30-Year Rate | ||||
| Average | 4.041% | 4.008% | 4.122% | 4.604% |
*All references to months should be read as month ended.
PROFILES OF CLOSED AND DENIED LOANS FOR MARCH 2015
| Closed First-Lien Loans (All Types) |
Denied Loans(All Types) | |
| FICO Score (FICO) | 731 | 667 |
| Loan-to-Value (LTV) | 79 | 83 |
| Debt-to-Income (DTI) | 24/37 | 28/47 |
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 December 2014 applications—to calculate an overall closing rate of 63.6 percent in March 2015 (see full report).
About the Ellie Mae Origination Insight Report
The Origination Insight Report mines its application data from a robust sampling of approximately 66 percent of all mortgage applications that are initiated through Ellie Mae’s Encompass all-in-one mortgage management solution. In 2014, approximately 3.7 million loan applications ran through Encompass. 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 non-qualification.
The Origination Insight Report details aggregated anonymized data. The report 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 (NYSE:ELLI) is a leading provider of innovative on-demand software solutions and services for the residential mortgage industry. Ellie Mae’s Encompass® all-in-one mortgage management solution provides one system of record that allows banks, credit unions and mortgage lenders to originate and fund mortgages and improve compliance, loan quality and efficiency. Visit EllieMae.com or call 877.355.4362 to learn more.