The share of all mortgage loans closed in January that were refinances rose to 45%, up 5 percentage points from December.
Mortgage software firm Ellie Mae reported that there was a 3-percentage-point rise in FHAs to 28%, and the percentage of conventional refinances increased to 51% of closed loans in January, up from 47% the month prior.
“As we ring in 2018, we see refinances rise as a percent of overall loan volume, something that we have seen every January since we began reporting this data,” said Jonathan Corr, president and CEO of Ellie Mae. “This increase in the percentage of refinances is attributed to slower seasonal purchase market carrying over from the end of 2017.”
Corr says he expects that the share of refinances will taper back off to industry projected levels of 25-30% in the coming months as purchases pick up.
The percentage breakdown of all closed loans changed slightly with conventional loans at 67%, FHA loans at 19% and VA loans at 10%.
Overall FICO scores dropped one point to 721, LTV dropped from 79 to 77 and DTI moved from 25/39 to 26/40.
Closing rates on all loans decreased from 71.2% to 70.9%; for refinances decreased from 65.6% to 65.5%; and for purchases decreased from 76.1% to 75.7%.
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