Refinances among millennials surged in February as interest rates dropped to near-record lows, according to Ellie Mae’s latest Millennial Tracker.
Ellie Mae said refinances among this group decreased month-over-month in both November and December 2019, before increasing month-over-month in both January and February 2020.
“Economic impacts due to coronavirus (COVID-19) played a role in lowering interest rates in February and millennial homeowners were quick to take advantage and refinance their mortgages,” Ellie Mae Chief Operating Officer Joe Tyrrell said in a statement.
“While rates are currently favorable for consumers, we’re closely monitoring how COVID-19, and the resulting rate cut from the Federal Reserve, will impact every step of the homebuying and refinancing process and, in turn, the mortgage finance industry,” Tyrrell said. “Lenders who have invested in the requisite technology will be better positioned to work with buyers and owners who are increasingly interested in taking these processes virtual.”
The refinance share for all closed loans to millennials in February was 34 percent, tied for the highest share since Ellie Mae began tracking this data in 2016. For conventional loans (75 percent of all loans closed by this group in February), refinances represented 41 percent.
During February, time-to-close for all loans by millennials dropped from 47 to 41 days on average.