Millennial Refinances Increased in Second Half of 2016 According to Ellie Mae Millennial Tracker

PLEASANTON, Calif. – January 9, 2017 – While mortgages for home purchases made up the bulk of loans taken out by millennials over the second half of 2016, they gradually declined as a percentage of all loans as the year went on. The Ellie Mae Millennial Tracker first started tracking in June of 2016, where purchase loans accounted for 85 percent of the loans millennial borrowers applied for, while refinances accounted for 14 percent of loan activity. By November, purchase loans dropped to 77 percent and refinances increased to 22 percent of all loans.

More than half (57 percent) of millennial borrowers took out conventional loans during the latter part of 2016, followed by FHA loans (40 percent) and VA loans (1 percent). From September through November, average loan amounts for home purchases held steady at $182,383, while loans for refinances had a higher average of $223,979.

FICO scores on closed purchase loans by millennials hovered in the low 720s from June through November. The average FICO score on refinances started at 721 in June, rose to a peak of 750 in October, then tapered off to 747 in November.

“While we have seen a steady increase in refinances among millennials, the bulk of this generation is still entering the market as first-time homebuyers,” said Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. “Across the board, we’re continuing to see strong interest in home ownership from this younger generation.”

Additional findings from the November Ellie Mae Millennial Tracker include:

  • Men who were listed as the primary borrower for new home purchases were 28.8 years old, on average, and 55 percent were married
  • Women who were listed as the primary borrower for new home purchases, were 28.6 years old, on average, and 36 percent were married
  • Average days to close for all home loans remained flat at 47 days, compared to October
  • Average time to close refinances increased to 51 days, up from 49 in October
  • Average days to close purchases increased to 46 days, up from 45 the month prior
  • Across all loans the share of conventional loans remained flat at 64 percent, with share of FHA loans decreasing to 32 percent of all closed loans, down from 33 percent in October
  • Across all loans, both the average debt-to-income ratio (DTI) and loan-to-value (LTV) held steady at 23/36 and 87, respectively

Ellie Mae® (NYSE:ELLI) is a leading provider of innovative on-demand software solutions and services for the residential mortgage industry. The Ellie Mae Millennial Tracker is an interactive online tool that provides access to up-to-date demographic data about this new generation of homebuyers. It 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.

For more information, 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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© 2017 Ellie Mae, Inc. Ellie Mae®, Encompass®, AllRegs®, the Ellie Mae logo and other trademarks or service marks of Ellie Mae, Inc. appearing herein are the property of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.

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