Adjustable-rate mortgages (ARMs) accounted for 9.2 percent of originations during December, up from 8.9 percent in November, according to new data from Ellie Mae. Last month’s ARM market share was the highest for 2018 and the highest since Ellie Mae started tracking this data in 2011.
“With the strong demand for housing and the rapid increase in property value appreciation, more consumers are turning to adjustable-rate mortgages in order to gain additional flexibility when competing for a home,” said Jonathan Corr, President and CEO of Ellie Mae. “This is another key indication of how demand has outpaced supply in the housing market as consumers pursue their dream of homeownership.”
Ellie Mae also reported that the percentage of purchase loans in December inched up to 71 percent from 70 percent in November, while overall FICO scores inched down one point to 726. The time to close all loans increased from 46 days in November to 47 days in December—the time close a purchase loan was 47 days and the time to close a refinance was 44 days.