Mortgage refinancing activity was quite healthy in the month of February, according to the newest Ellie Mae Origination Insight Report. Not only did mortgage refinancing in relation to overall mortgage activity increase by a healthy 8 percent to 59 percent of composite loan volume, the average time to close a mortgage refinance also went down, dropping to 36 days.
The 36-day turnaround time to close a refinance was also the shortest time on record since Ellie Mae, a mortgage industry software solution provider, began tracking this statistic in August 2011. And with refinancing activity in general also much healthier in February, Ellie Mae believes that a lot has to do with the fact that mortgage rates had reached their lowest levels in more than a year and a half in the early parts of 2015.
“The drop in the average 30-year fixed rate in last few months has kept lenders busy with increased refinance business,” said Ellie Mae president and CEO Jonathan Corr in a statement “Considering the demand, the fact that lenders are taking fewer days to close the average refi loan is very good news.”
The Ellie Mae Origination Insight Report also included some data on mortgage rates, primarily those for 30-year fixed products. For standard 30-year fixed-rate mortgages, Ellie Mae reported an average interest rate of 4.008 percent, down from the previous month’s 4.154 percent; this is the lowest level on the company’s record in two years.
For 30-year fixed mortgages backed by the Federal Housing Administration, rates dropped below 4 percent for the first time since June 2013. Separately, most other weekly reports, including those from Freddie Mac, Zillow, and the Mortgage Bankers Association, also show 30-year FRMs at their lowest points since the spring of 2013, right before rates began spiking in the summer of that year.
Ellie Mae’s press releases state that the Origination Insight Report is based on a “robust sampling of approximately 66 percent of all mortgage applications” that were initiated on the company’s proprietary Encompass origination platform. The company adds that this analytic report “is a strong proxy of the underwriting standards employed by lenders across the country.”
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