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Closing rate for mortgage originations drops in July

Closure for 90-day applications falls below 60%

application

Mortgage originations showed an overall closing rate of 57.7% in July 2014, down from 60.7% in June 2014, according to a sample of 90-day loan applications conducted by Ellie Mae (ELLI), a leading provider of innovative on-demand software solutions and services for the residential mortgage industry.

“The purchase market continued to climb in July with the share of closed purchase loans reaching 67%, the highest percentage since we began tracking this data in August 2011,” said Jonathan Corr, president and chief operating officer of Ellie Mae.

“Meanwhile, time to close for all loans dropped to 37 days, the lowest average we’ve seen since we began tracking. This reflects time to close decreasing across the board, with an average of 36 days for conventional loans and 38 days for FHA and VA loans,” he said.

Corr added, “The average 30-year rate for all loans declined once again to its lowest level of 2014: 4.388% in July, down from 4.421% in June 2014.

“The average FICO score fell one point to 727 in July, reversing a four-month trend. A further sign of easing: 32% of closed loans had an average FICO score under 700 last month compared to 25% in July 2013.”

Mortgage applications, which have been flat to declining most of 2014, ticked up this week. Rates have pretty much held steady for the last two quarters.

Mortgage applications increased 1.4% from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending August 15, 2014.  

MONTHLY ORIGINATION OVERVIEW FOR JULY 2014

 

July 2014*

June 2014*

6 Months Ago

(January 2014)*

1 Year Ago

(July 2013)*

Closed Loans

Purpose

Refinance

32%

33%

47%

47%

Purchase

67%

65%

53%

53%

Type

FHA

20%

21%

21%

19%

Conventional

64%

65%

67%

71%

VA

11%

10%

-

-

Days to Close

All

37

41

45

47

Refinance

37

39

44

48

Purchase

38

42

47

46

ARMs vs. Fixed / Length / Rate

ARM %

6.5%

7.2%

  7.2%

  5.2%

15 Year %

8.9%

9.0%

15.0%

15.5%

30-Year

Note Rate

4.388%

4.421%

  4.723%

  4.357%

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

 

PROFILES OF CLOSED AND DENIED LOANS FOR JULY 2014

 

Closed First-Lien Loans (All Types)

Denied Loans

(All Types)

FICO Score (FICO)

727

689

Loan-to-Value (LTV)

82

81

Debt-to-Income (DTI)

24/37

28/45

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