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The MReport Webcast: Thursday 8/21/2014

Despite a slight easing in credit standards, the percentage of loan applications closed in July slipped to a three-month low, according to Ellie Mae. Tracking loan applications in its latest Origination Insight Report, the company calculated an overall closing rate of 57.7 percent last month, down from 60.7 percent in June and 57.8 percent in May. The decline came as home purchase applications expanded to take up a larger piece of the market at 67 percent of total application activity.

Meanwhile, credit standards on closed loans shifted down just slightly, with the average FICO score slipping to 727 after a four-month upward trend. The average loan-to-value ratio was unchanged for the seventh straight month at 82 percent. For denied loans, the average FICO was up three points to 689, while the average LTV was down to 81 percent. As of July, Ellie Mae says nearly one-third of closed loans had an average FICO under 700, up from just a quarter of loans last year.

Housing market trends kept their spring momentum in July and are expected to remain solid in the months ahead, according to a new report from Realtor.com. According to data presented by the company, the number of homes on the market as of the end of July increased 2.3 percent compared to last year, improving to nearly 1.98 million. That compares to a nearly 6 and a half percent drop in inventory recorded in July 2013 and a 14 percent drop the year before that. With positive momentum building, Realtor-dot-com’s chief economist, Jonathan Smoke, says all metrics point to fundamental market health and more improvements through the year’s second half.

About Author: Jordan Funderburk

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