Purchase Loans Now Outpacing Refis


Purchase loans continued to increase as a
percentage of loan originations in April. 
Ellie Mae’s Origination Insight
for the month put the purchase share of all closed loans at 52
, a 6 percentage point jump from March and the first time in 2015 that more
than half of loans were originated for that purpose.

Seventy-two percent of FHA loans were for
purchasing, also a 6 point month-over-month increase but significantly lower
than the 80+ percent share of its loans that went for purchasing every month
from May 2014 through January 2015. 
Fifty-eight percent of conventional loans were originated for purchasing
and 68 percent of VA loans.

Of all loans originated in April 64 percent were
conventional, 24 percent FHA, 9 percent VA and 3 percent were classified as “other.”

Ellie Mae noted that the percentage of FHA
refinances that had a greater than 95 percent loan-to-value (LTV) ratio dipped from
41.6 percent in March to 38.1 percent.  The
company did not comment as to whether this may be related to the new 97 percent
LTV loans offered by Fannie Mae and more recently by Freddie Mac but the share
of high LTV conventional loans did rise month-over-month from 4.3 to 5.2

The company said that the number of days required to
close a loan in April were the most since January 2014, likely due to higher
than expected origination volume.  It
took an average of 45 days to close a loan with refinances averaging 48 days
and purchase loans 43 days.

The closing rate for all loans was 65.2 percent,
exceeding 65 percent for the first time since Ellie Mae began tracking that
information in August 2011. 

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