In January, slightly lower interest rates led to Millennial homebuyers increasing their requests to refinance their mortgages.
In fact, according to Ellie Mae’s latest Millennial Tracker survey, refinances climbed to 35% in January, and a whopping 13% belonged to Millennial borrowers. This is the highest percentage since way back in February of last year.
“With average interest rates slightly falling in January, Millennials took advantage of refinance opportunities,” Ellie Mae Executive Vice President of Strategy and Technology Joe Tyrrell said. “While we continue to see Millennials enter the housing market and exercise their purchase power, the uptick in refinances may indicate maturity among this generation who previously purchased a home and are looking for an opportunity to take advantage of lower monthly interest payments.”
Notably, Ellie Mae also discovered that refinances made up a larger share of each loan type in January. Of these loans, Millennial refinances for conventional loans rose to 14%, FHA refinances slightly increased to 7% and VA refinances climbed to 35%.
Interestingly, the Millennial Tracker showed that the average age of Millennial borrowers in January was 33, with males listed as the primary borrower on 63% of closed loans. Furthermore Ellie Mae's data also indicates that 66% of those who refinanced were married, while 33% were single and 1% were unspecified.
Lastly, the average FICO score for Millennial borrowers edged up to 722 in January, inching forward from 721 back in December, according to Ellie Mae.
NOTE: The Ellie Mae Millennial Tracker provides access to up-to-date demographic data about Millennial homebuyers, mining data from approximately 80% of all closed mortgages dating back to 2014.