Conventional Loans Experience Slight Increase According to July Ellie Mae Millennial Tracker™

Average FICO scores increase slightly with conventional loan type as key driver

PLEASANTON, Calif. – September 7, 2016 – As summer and the traditional home buying season began to wind down, the percentage of millennial conventional loans increased slightly from 61 percent in June to 62 percent of total closed loans in July according to the latest Ellie Mae Millennial Tracker. FHA loans decreased as a percentage of overall loans, accounting for 35 percent of all closed loans in July compared to 37 percent in June and May.

The average FICO score for millennial borrowers in July was 725, compared to 724 in June and 722 in May, driven by the slight shift to conventional loan products. The Millennial Tracker is an interactive online tool that provides access to up-to-date demographic data about this new generation of homebuyers. Ellie Mae® (NYSE:ELLI) is a leading provider of innovative on-demand software solutions and services for the residential mortgage industry.

Average note rates saw a substantial decline in July, dropping to 3.07 percent from 3.22 percent in June. Average DTI stayed consistent from June to July with average DTI of 23/36 and LTV decreased slightly from 88 in June to 87 in July.

“As the percentage of conventional loans increases, we see a corresponding uptick in the average FICO scores,” said Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. “The percentage of conventional loans has increased for the past two months, from May with 60 percent of all closed loans being conventional, to July which was at 62 percent. During that same time period the average FICO score increased from 722 in May to 725 in July. However, FHA loans remained a popular loan option among millennial borrowers with FHA loans representing 35 percent of closed loans for millennials while amongst the entire age population they represented 23 percent.”

MILLENNIAL TRACKER HIGHLIGHTS FOR JULY 2016
Loan Type Percentage of Loan Type Average Primary FICO Average Days to Close
Conventional 62% 749 45
FHA 35% 691 45

Unchanged since March, women were listed as the primary borrower on 32 percent of closed loans. Among women who were listed as the primary borrower, 39 percent were married and 61 percent were single.

Consistent with June data, among male primary borrowers, 58 percent were listed as married and 42 percent single, a significant difference from women. Additionally, the average age for borrowers held steady from the month prior, resulting in 29.0 for female primary borrowers and 29.3 for male primary borrowers.

Metropolitan Statistical Areas (MSAs) where millennials accounted for at least half of mortgage loans closed included Owensboro, Ky. (62 percent), Midland, Mich. (58 percent), Chillicothe, Ohio (54 percent), Hutchinson, Minn. (52 percent) and Waterloo-Cedar Falls, Iowa (50 percent). Consistent with May data, when sorted by population, top MSAs included Minneapolis/St. Paul/Bloomington, Minn./Wis., Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md. and Baltimore/Columbia/Towson, Md.

The Ellie Mae Millennial Tracker mines data from a robust sampling of approximately 75 percent of all closed mortgages dating back to 2014 that were initiated on Ellie Mae’s Encompass® all-in-one mortgage management solution. Given the size of this sample and Ellie Mae’s market share, it is a strong proxy of millennial mortgage indicators across the country. Searches can be tailored by borrower geography, age, gender, marital status, FICO score and amortization type.

The Ellie Mae Millennial Tracker is a supplement to Ellie Mae’s monthly Origination Insight Report, which focuses on loans that closed in a specific month and compares their characteristics to similar loans that closed three and six months earlier.

For more information on the Ellie Mae Millennial Tracker, visit http://elliemae.com/millennial-tracker

About the Ellie Mae Millennial Tracker

The Ellie Mae Millennial Tracker focuses on millennial mortgage applications during specific time periods. Ellie Mae defines millennials as applicants born between the years 1980 and 1999. New data is updated on the first Monday of every month for two months prior.

The Millennial Tracker is a subset of our Origination Insight Report, which details aggregated, anonymized data pulled from Ellie Mae’s Encompass origination platform. Additional information regarding the Origination Insight Report can be found at http://elliemae.com/resources/origination-insight-reports. News organizations have the right to reuse this data, provided that Ellie Mae, Inc. is credited as the source.

About Ellie Mae

Ellie Mae (NYSE:ELLI) is a leading provider of innovative on-demand software solutions and services for the residential mortgage industry. Mortgage lenders of all sizes use Ellie Mae’s Encompass® all-in-one mortgage management solution, Mavent Compliance Service, and AllRegs research, reference and education resources to improve compliance, loan quality and efficiency across the entire mortgage lifecycle. Visit EllieMae.com or call (877) 355-4362 to learn more.

PRESS CONTACT

Erica Harvill
Ellie Mae, Inc.
(925) 227-5913
Erica.harvill@elliemae.com

Alexandra Gardell Kreuter
Allison+Partners
(646) 428-0618
EllieMae@allisonpr.com

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