ARMs originations hit record high
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Market Data
Monday, December 31, 2018
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The percentage of adjustable rate mortgages (ARMs) in November reached 8.9 percent, which Ellie Mae said is the highest percentage since it began tracking data in 2011.
According to Ellie Mae’s Origination Insight Report, the increase in ARMs is directly correlated to the 30-year rate, which rose to 5.15 percent in November, up from 5.01 percent the month prior. For FHAs, the 30-year rate increased from 5.05 percent in October to 5.19 percent in November. Conventional rates increased from 5.03 percent in October to 5.17 percent in November, and VA rates rose from 4.83 percent to 4.99 percent.
“As interest rates continue to rise, we are seeing the percentage of adjustable rate mortgages rise in lockstep, and this month they’ve risen to the highest percentage we’ve seen since we began tracking data,” Ellie Mae President and CEO Jonathan Corr said in a release. “As expected, we are also continuing to see the percentage of refinances remain low—30 percent in November—due to higher interest rates.”
During November, the time to close all loans increased to 46 days, up from 45 days in October. Time to close a purchase loan increased to 48 days, up from 46 days in October, while time to close a refinance remained at 43 days for the second consecutive month, according to the report.
Ellie Mae said the percentage of purchase loans rose to 70 percent of total loans in November, up from 68 percent the month prior. Overall FICO scores remained steady at 727 in November for the third month. LTV held at 79 for the fourth month, and DTI held at 26/39 for the second month.
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