Millennials Contributing to The Ongoing Refinance Boom, Ellie Mae Finds
With interest rates nearing 3% for all loans, many millennials took advantage of the opportunity to refinance their mortgages in September, according to the latest Millennial Tracker report from loan origination platform provider Ellie Mae.
Refinances climbed to 43% of all closed loans for millennials in September, up 3% from the previous month.
Refinances accounted for 51% of Conventional loans in September, the highest percentage since June, and up from 48% just the month prior.
In September, older millennials locked in slightly higher interest rates of 3.00%, on average, compared to 2.98% for younger millennials.
With interest rates historically low, the share of refinance loans increased for both sub-groups of millennials.
While millennials are buying homes, the end to summer homebuying seasonality meant purchases dipped for the second month in a row, accounting for 56% of all closed loans, down from 59% in August.
Conventional purchase loans shrunk to 48% for the month, down from 52% in August. VA refinances stayed steady at 35% month-over-month, and VA purchase loans held at 65% month-over-month during this same time period. Meanwhile, FHA percentages have held steady for the past four months.
Time-to-close for all loans increased to 49 days in September, compared to 47 in August. Given the increase in refinances, the time-to-close on refinance loans also increased by two days, month-over-month, to 55 days in September.
The Ellie Mae Millennial Tracker offers insights into two groups of millennial homebuyers: older millennials between 30 and 40 years old, and younger millennials between 21 and 29 years old.
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 80% 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.
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