Ellie Mae Releases November 2013 Origination Insight Report

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Refinance Share Jumps as 30-Year Rate Declines

PLEASANTON, Calif. – December 18, 2013 – Ellie Mae® (NYSE: ELLI), a leading provider of enterprise-level, on-demand automated solutions for the residential mortgage industry, today released its Origination Insight Report for November 2013. The report draws its data and insights from a robust sampling of the significant volume of loan applications—more than 20% of all originations in the United States—that flow through Ellie Mae’s Encompass® mortgage management software and the Ellie Mae Network™.

Monthly Origination Overview for November 2013

 

November 2013*

October 2013*

6 Months Ago
(May 2013)*

1 Year Ago
(November 2012)*

Closed Loans

Purpose

Refinance

45%

39%

58%

68%

Purchase

55%

61%

42%

32%

Type

FHA

20%

19%

19%

19%

Conventional

69%

68%

72%

73%

Days to Close

All

42

45

44

50

Refinance

37

43

44

51

Purchase

45

46

45

48

ARMs vs. Fixed, Length, Rate

ARM %

5.8%

5.6%

3.1%

2.0%

15 Year %

14.5%

15.5%

16.4%

16.7%

30 Year – Note Rate

4.526

4.750

3.747

3.600


*All references to months should be read as month ended.
Profiles of Closed and Denied Loans for November 2013

 

Closed First-Lien Loans
(All Types)

Denied Loans
(All Types)

FICO Score (FICO)

729

694

Loan-to-Value (LTV)

81

82

Debt-to-Income (DTI)

25/38

28/44


More information and analysis of closed and denied loans by loan purpose and investor are available in the full report at http://www.elliemae.com/about-us/news-reports/ellie-mae-reports/.

To get a meaningful view of lender “pull-through,” Ellie Mae reviewed a sampling of loan applications initiated 90 days prior (i.e., the August 2013 applications) to calculate an overall closing rate of 53.1% in November, up from 51.4% in October 2013 (see full report).

“Refinances increased by six percentage points in November, the first time in ten months refinance share increased on a month-over-month basis,” said Jonathan Corr, president and chief operating officer of Ellie Mae. “This was probably attributable to the quarter of a point decline in the interest rates on the 30-year note in November, which declined to 4.526.

“HARP-related refinancing activity also increased, as conventional refinances at 95%-plus LTV rose to 8.30% in November from 7.30% in October.

“Credit requirements also continued to loosen,” Corr added. “The average FICO score for all closed loans in November 2013 was 729, compared to 750 in November 2012. Also, 30% of closed loans had an average FICO score below 700 in November 2013, compared to 22% in 2012.

“The average time to close a loan decreased to 42 days in November with refinances falling to 37 days, the lowest since we began tracking in August 2011.”

About Ellie Mae Origination Insight Report

In 2012, the total volume of mortgages that ran through Ellie Mae’s Encompass mortgage management software was approximately three million loan applications, or 20% of all U.S. mortgage originations. The Origination Insight Report mines its application data from a robust sampling of approximately 44% of all mortgage applications that were initiated on the Encompass origination platform. Given the size of this sample and Ellie Mae’s market share, the Company believes the Origination Insight Report is a strong proxy of the underwriting standards that are being employed by lenders across the country.

The Origination Insight Report focuses on loans that closed or were denied in a specific month and compares their characteristics to similar loans that closed or were denied three and six months earlier. The closing rate is calculated on a 90-day cycle rather than on a monthly basis because most loan applications typically take one and a half to two months from application to closing. Loans that do not close could still be active applications or applications withdrawn by consumers or denied for incompleteness or nonqualification.

The Origination Insight Report details aggregated, anonymized data and does not disclose client-specific or proprietary information.

News organizations have the right to reuse this data, provided that Ellie Mae, Inc. is credited as the source.

About Ellie Mae

Ellie Mae, Inc. (NYSE: ELLI) is a leading provider of on-demand automation solutions for the mortgage industry. The Company offers an end-to-end solution, delivered using a Software-as-a-Service model that serves as the core operating system for mortgage originators and spans customer relationship management, loan origination and business management. The Company also hosts the Ellie Mae Network™ that allows Encompass® users to electronically conduct business transactions with the lenders and settlement service providers they work with to process and fund loans. The Company’s offerings include the Encompass and DataTrac® mortgage management software systems.

Ellie Mae was founded in 1997 and is based in Pleasanton, California. To learn more about Ellie Mae, visit www.EllieMae.com or call 877.355.4362.

© 2013 Ellie Mae, Inc. Ellie Mae®, Encompass®, DataTrac®, Ellie Mae Network™ and the Ellie Mae logo are registered trademarks or trademarks 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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