1 extra week for new mortgage disclosure closings
PLEASANTON, Calif. – Jan. 20, 2016 – According to Ellie Mae's monthly Origination Insight Report, it takes about one week longer to close on a home than it did before the Oct. 3, 2015, debut of new mortgage disclosures.
By the end of 2015, it took an average 49 days to close a loan, according to Ellie Mae. While the average time to close a refinance fell from 49 days to 47 days, purchases climbed 1 day to 50. The average time to close FHA and conventional loans remained largely unchanged at 49 days; VA loans increased from 50 to 52 days.
In terms of loan purpose, purchases represented 56 percent of all closed loans while refinances (as a percentage of lenders' overall loan volume) decreased for the first time in seven months from 46 percent in November to 43 percent in December.
Average FICO scores on closed loans increased for the first time since May from 720 in November to 722 in December, while the average FHA refinance FICO score increased to 651, up from 648 in November.
Closing rates for all loans remained high at 67 percent in December, though down slightly from 68 percent in November, with November's results representing the highest percent in all of 2015. Closing rates on refinances reached their highest point of the year at 63 percent in December, while closing rates on purchases dropped slightly from 72 percent in November to 71 percent in December.
"While our customers are certainly impacted by the Know Before You Owe changes, we've been providing them with resources, training and tutorials to help mitigate the effects," says Jonathan Corr, president and CEO of Ellie Mae. "And while the time to close loans remained consistent from November, the 49-day cycle is still a week longer than the time to close at this same time last year."
The Origination Insight Report mines its application data from a sampling of approximately 66 percent of all mortgage applications t initiated on the Encompass all-in-one mortgage management solution.
Other findings from the December report:
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