Home loan purchase percentages closed 2016 on the rise while refinancing began to slightly soften, according to the latest Ellie Mae Origination Insight Report.
Last month, home purchases accounted for 54 percent of all closed loans, up from 53 percent in November, while December’s refinances represented 46 percent of closed loans, down from 47 percent the month prior. Ellie Mae attributed this seesaw effect to rising rates: The 30-year note rate in December was 4.05, up from 3.81 in November.
Closing rates for all loans increased to 73.2 percent in December, the highest rate of 2016. Refinance closing rates increased to 69.6 percent, up from 68.7 percent, while purchase closing rates increased to 77 percent, up from 76.1 percent in November.
The average time to close all loans in December was 50 days, up from 49 days in November. The time to close a refinance increased to 52 days and time to close a purchase increased to 48 days, both up one day from November.
On the decline however, were average FICO scores: 726 in December, slightly under the 728 level from the month prior. Conventional purchase FICO scores stayed steady at 753 for the third month while conventional refinance FICO scores dropped from 743 in November to 739 last month.
“As rates began to increase we saw purchases tick back up in December, signaling the start of a trend we expect to continue into 2017,” said Jonathan Corr, president and CEO of Ellie Mae. “We also saw closing rates rise to the highest percentage in 2016 as homebuyers locked in rates and lenders closed loans before the conclusion of the year.”
