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Lending

Average FICO score on closed loans declines: Ellie Mae

It took longer to close a loan in April, but the average FICO score on a successfully closed loan fell somewhat, suggesting less restrictive underwriting, according to Ellie Mae data.

The average FICO score on loans that successfully closed after passing through Ellie Mae's mortgage management platform fell to 745 in April, down from 749 in March and 750 in February, Ellie Mae said in its April origination report.

Overall, average FICO scores in the past nine months have hovered somewhere between 741 and 750, with the average score on closed loans hitting their highest point in October and February.

The same report shows the loan-to-value ratio on closed loans reaching a nine-month high of 80 in April, compared to 77 in March and 76 in February and January. 

Meanwhile, denied loan applications that passed through Ellie's network had an average FICO of 702 and an LTV ratio of 87, compared to a FICO of 699 and an LTV of 85 in March.

The Ellie origination report essentially studies the characteristics of 2 million loan applications, or 20% of all U.S. mortgage originations, that pass through its system.

Of those loans that closed last month, 56% were refinancings, down from 61% in March. Purchase applications, on the other hand, represented 44% of mortgage origination activity, up from 39% in March.

About 28% of the originated loans studied by Ellie Mae in March were classified as FHA mortgages, while the remaining 62% were conventional mortgages.

On average, it took more days, approximately 45, for loans to close in April. That is up from 42 days in March and 44 days in February. Still, it is improved from the average 48-day closing rate set in January.

kpanchuk@housingwire.com

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