Ellie Mae states interest rates on all loans closed in April fell, again, this time to 3.48%.
This is a decline from March’s 3.65%, according to Ellie Mae’s Origination Insight Report.
The 30-year rate on loans backed by the Federal Housing Administration fell to 3.56% in April from the prior months’ 3.76%. Interest rates on VA loans declined from 3.45% to 3.31%.
Falling rates are leading to rising refinances, as refinancing represented 65% of closed loans in April—up from 55% in March and 51% in February.
Refinances accounted for just 35% of all closed in April 2019.
“Interest rates continued to decline in April, driving up the share of refinances by 10%,” said Jonathan Corr, President and CEO of Ellie Mae. “We’re also seeing FICO scores increase as lenders manage the current economic uncertainty by tightening credit. Ellie Mae has seen record volumes on our Encompass Digital Lending Platform in recent weeks, indicating that by leveraging digital mortgage technology, our lenders are able to serve their customers through this time of rapid change.”
Data from April also found the time to close all loans increased to 42 days, which is a slight increase from the 4 days in March. The average FICO scores on all loans closed in April rose to 749 from the previous month’s 742.
ATTOM Data Solutions reported that Q1 2020 saw 1.07 million refinances secured.
This is a 16% decline from Q4 2019, but an annual increase of 87%. Near record-low interest rates led to $328.5 billion in total refinance volume during Q1 2020, which is a year-over-year increase of 105%.
Refinance loans accounted for 55.7% of all 1.92 million loans during Q1 2020—unchanged from the 55.9% of loans during Q4 2019, but up from Q1 2019’s 41.3%.
Home-loan data was way up again in the first quarter of the year, with refinancing activity again accounting for more than half the total volume of mortgages. The number and dollar value of home loans marked yet another sign of how charged up the U.S. housing market continued to be in the early months of the year when everything was still pointing in the right direction,” said Todd Teta, Chief Product Officer at ATTOM Data Solutions.