Interest rates on all closed loans continued to decline in June to 3.40 percent, down from 3.43 percent in May, according to the latest Origination Insight Report from Ellie Mae.
The 30-year rate on conventional loans fell again, dropping to 3.42 percent, down from 3.44 percent in May. Similarly, the 30-year rate on FHA loans fell to 3.41 percent in June, down from 3.45 percent in May. The 30-year rate on VA loans dropped to 3.20 percent in June, down from 3.24 percent in May.
The purchase market began to rebound in June, accounting for 42 percent of all closed loans in the month, up from 35 percent the month prior. Refinances accounted for the remaining 58 percent of closed loans, down from 65 percent in May.
Other statistics of note in June included:
- The time to close all loans increased to 47 days, up from 45 the month prior. Time to close for purchase loans decreased to 46 days, down from 47 the month prior, while time to close refinances increased to 48 days, up from 44 days the month prior.
- FICO scores on all loans increased to 751 in June, up from 750 in May. FICO scores also increased month-over-month for both purchase and refinances across Conventional, FHA and VA loans.
- Closing rates dropped to 73.4% in June, down from 76.0% in May.
“Interest rates decreased for the sixth consecutive month and we’re seeing a rebound in the purchase market which now represents 42 percent of all closed loans, a seven percent increase from May,” said Jonathan Corr, President and CEO of Ellie Mae. “Homebuyers are taking advantage of these historically low rates to both buy and refinance but it does appear that lenders are looking for borrowers with better credit across all mortgage products as FICO scores have continued to increase across the board since March.”
The Origination Insight Report mines data from a robust sampling of approximately 80 percent of all mortgage applications that were initiated on the Encompass all-in-one mortgage management solution.