The share of home loan applications that closed improved on a monthly basis, though turnaround on loan originations suffered.
Two-thirds of March’s business was conventional, while loans insured by the Federal Housing Administration accounted for 22 percent.
Mortgages that were guaranteed by the Department of Veterans Affairs represented 9 percent of the latest month’s originations.
The statistics were among many presented in Ellie Mae Inc.’s Origination Insight Report. The data is derived from a two-thirds sampling of loan applications initiated on Ellie’s origination platform.
Out of all loans started in the previous 90-day cycle, 63.6 percent closed in March. The closing rate improved from 60.0 percent the prior month and 58.0 percent in the same month during the prior year.
March’s closing rate was 63.1 percent on conventional mortgages, 53.6 percent on FHA loans and 61.3 percent on VA mortgages.
Ellie noted that it took 44 days to close the average loan in March, slowing by six days compared to a month earlier and four days longer than a year earlier.
“As many anticipated, purchase loan activity is gaining momentum as the housing market enters the peak spring buying season,” Ellie Mae President and Chief Executive Officer Jonathan Corr said in a written statement. “This, along with the slightly higher than expected origination volume the industry is seeing, likely contributed to the rise in days to close.”
Refinances took 45 days to close, and purchase financing turnaround was 44 days.
Originators spent 45 days closing conventional loans. On FHA mortgages, the time table was 43 days, while VA loans took 45 days.
Average FICO scores slipped one point from February to 731. But credit scores were higher than 725 in March 2014.
FICO scores averaged 742 on conventional refinances and 755 on conventional purchases. FHA FICOs averaged 685 on both refinances and purchases. On VA mortgages, credit scores were 716 on refinances and 702 on purchases.
The average overall loan-to-value ratio was 79 percent, unchanged for two months. Average LTV ratios declined from 82 percent in the same month last year.
Conventional LTV ratios averaged 70 percent on loan refinances and 81 percent on
purchase-money mortgages.
On FHA-insured mortgages, LTV ratios were 85 percent on refinancings and 95 percent on purchase financing, while VA loans had an 88 percent average on refinancings and 98 percent on purchase financing.
Debt-to-income ratios averaged 24/37 percent on all loans during the most-recent month, the same as both of the prior two months and as the same month in 2014.
On conventional refinances, the average DTI was 24/37 percent, while it dropped to 22/34 percent on conventional purchases. DTI ratios were 26/41 percent on FHA refinances and 27/41 on purchase transactions. Average DTI ratios on all VA loans were 24/39 percent.
Refinance share tumbled to 53 percent from 59 percent in February but was still wider than 40 percent in March 2014. On conventional loans, refinance share was 64 percent, while it dropped to 34 percent on FHA mortgages and 35 percent on VA loans.
