Millennials’ overall time to close a loan drops

by MPA10 Apr 2017
In February, it took an average of 44 days to close loans for millennial borrowers, according to Ellie Mae’s Millennial Tracker. This marked the shortest average time to close since March 2016.

Ellie Mae observed a drop in average time to close across all types of loans:
February 2017
January 2017
FHA Loans
43 days
47 days
Purchase Loans
42 days
46 days
Refinance Loans
52 days
58 days
VA loans
41 days
57 days

Purchases accounted for 86% of all closed loans for the month of February, a slight rise from 84% during the previous month. Meanwhile, refinances dipped two percentage points to 14% of all loans to millennial borrowers.

“Purchase loans are increasing, indicating that millennials are continuing to enter the first-time homebuyer market,” said Joe Tyrrell, executive vice president of corporate strategy for Ellie Mae. He said the decrease in time to close “indicates that our lenders are seeing more efficiency as they embrace mortgage automation.”

Conventional loans remained at 61% of all loans, and FHA loans inched one percentage point to 36%.
The Millennial Tracker observed a drop in FICO scores across all loan types, with an average of 723 from January’s 724. For purchases, the average FICO score was 747 for a conventional loan, 690 for an FHA loan and 745 for a VA loan.

“In February, the hottest housing market for millennials was in the state of Texas. The top markets by percentage of millennial loans closed in the state included Odessa, Midland and Beaumont-Port Arthur,” Ellie Mae said.

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