Mortgage rates continued to decline through the spring home buying season, driving up the share of refinance loans and overall closing rates, according to Ellie Mae.
The 30-year note rate dropped to 4.77% in March from 4.86% in February; it’s also down from 5.01% in January, marking the third consecutive month of declines. This helped push up the percentage of mortgage refinances closed in March to 35% from 34% month-over-month. A year ago, the share was 38%.
While the share of closed purchase loans subsequently ticked down a point to 65% in March, it’s still up from 62% a year ago, and the closing rate for all loan types has grown a decent amount from March 2018.
“As we enter the busy spring home buying season, we are seeing activity tick back up across the board with the 30-year note rate decline,” Jonathan Corr, president and CEO of Ellie Mae, said in a press release.
“We will continue to watch closing rates as they have stayed at or above 75% through the first quarter of 2019, a possible indication of buyers’ conviction,” he said.
Closing rates for refinance loans rose to 71.3% on an annual basis from 64.9%, and increased for purchase loans to 78% from 76.3%.
The time to close on a mortgage declined in March, falling to an average of 45 days. This is down from 49 days at the start of the year and from 47 days in February.
Average FICO scores across all loan types held steady at 726 between February and March, but did grow from 722 during this same period last year.
The March data, from Ellie Mae’s Origination Insight Report, analyzed approximately 80% of mortgage applications initiated through the company’s Encompass platform. Ellie was officially acquired by Thoma Bravo on Wednesday in an all-cash transaction valued at $3.7 billion.