The share of closed mortgage loans that were refinances finally posted an increase in August, the first rise in 2018.
Ellie Mae’s Originations Insight Report shows that refinances took a 32% share of all closed loans, rising from 29% in July.
With 30-year mortgage rates averaging 4.92% in August, up only slightly from the 4.91% in July and 4.90% in June, homeowners have seen rate growth slow over several months.
“The rise in interest rates has slowed since June, and we are seeing the percentage of refinances increase month-over-month since May,” said Jonathan Corr, president and CEO of Ellie Mae. “This may reflect consumers taking an opportunity to refinance with the corresponding increase in equity.”
Closing rates tick higher
Across all loans, the closing rate of 71.1% in August was the highest so far in 2018 and was up from the 70.9% of July.
For purchase loans, the closing rate increased to 75.9% from 75% while refinances saw a declining rate from 63.7% in July to 63.5% in August.
FICO scores were down slightly to 724 while LTV decreased to 79 and DTI held at 26/39.
The time to close all loans was 43 days, the same as in July, but for purchases it was up one day to 45.
More market update: