Ellie Mae® (NYSE: ELLI), a leading provider of enterprise-level, on-demand automated solutions for the residential mortgage industry, today released its Origination Insight Report for May 2012. The report draws its data and insights from a robust sampling of the significant volume of loan applications—more than 20% of all originations in the United States—that flow through Ellie Mae’s Encompass360® mortgage management software and Ellie Mae Network™.
MONTHLY ORIGINATION OVERVIEW FOR MAY 2012
|May 2012||April 2012||3 Months Ago|
|6 Months Ago|
|Days to Close|
|ARMs vs. Fixed, Length, Rate|
|15 Year %||17.6%||18.4%||19.6%||19.7%|
|30 Year – Note Rate||4.116||4.151||4.095||4.258|
PROFILES OF CLOSED AND DENIED LOANS FOR MAY 2012
Closed First-Lien Loans
|FICO Score (FICO)||744||702|
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/aboutus/about_reports.asp.
To get a meaningful view of lender “pull-through,” Ellie Mae reviewed a sampling of loan applications initiated 90 days prior (i.e., the February applications) to calculate a closing rate for May. Ellie Mae found that 47.2% of all applications closed in May compared to 48.1% in April (see full report).
“In May, the average loan-to-value (LTV) for closed loans broke the 80% mark for the first time since our tracking began in August 2011,” said Jonathan Corr, chief operating officer of Ellie Mae. “The increase appeared to be driven by an easing of LTVs on conventional refinances (the average LTV was 72% in May compared to 69% in April). Last month, closed conventional refinances with LTVs of 95%-plus jumped to 11%, up from 7.1% in April and 3.6% in March, which may be a sign that HARP 2.0 is helping more borrowers.
“As you’d expect in the Spring sales season, the percentage of purchase loans increased to 46%, their highest level of the year. Credit scores for closed loans decreased slightly to 744 in May, with the biggest drop in FHA refinances, where the average credit score declined to 713 in May from April’s average of 720.
“The combination of record-low interest rates, flexible HARP 2.0 refinances and a growing perception that housing prices finally may have bottomed are all creating increased demand—and slightly longer waits—for mortgages,” said Corr. “In May, the average loan closed in 46 days, one day longer than in April; and the average refinance also took one day longer, or 48 days, to close.”
About Ellie Mae Origination Insight Report
In 2011, the total volume of mortgages that ran through Ellie Mae’s Encompass360 mortgage management software was approximately two million loan applications, or 20% of all U.S. mortgage originations. The Origination Insight Report mines its application data from a robust sampling of approximately 33% of all mortgage applications that were initiated on the Encompass origination platform. 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 in the prior three-month and six-month periods. 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 months to two months from application to closing. Loans that do not close could still be active applications, withdrawn by the consumer or denied for incompleteness or nonqualification.
The Origination Insight Report details aggregated, anonymized data and 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, Inc., is a leading provider of on-demand automation solutions for the mortgage industry. The Company offers an end-to-end solution, delivered using a software-as-a-service model that serves as the core operating system for mortgage originators and spans customer relationship management, loan origination, and business management. The Company also hosts the Ellie Mae Network™, which allows mortgage professionals to conduct electronic business transactions with the lenders and settlement service providers they work with to process and fund loans. The Company’s offerings include the Encompass®, Encompass360®, and DataTrac® mortgage management software systems.
Ellie Mae was founded in 1997 and is based in Pleasanton, California. To learn more about Ellie Mae, visit www.EllieMae.com or call 877.355.4362.
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