Mortgage Closing Rate Hits New High in August

After dipping in July, mortgage closing rates recovered again to a new record high last month, according to data released Thursday.

Examining a sample of loans initiated in May, mortgage technology provider Ellie Mae calculated a closing rate of 61.1 percent for all loans, up from 57.7 percent in July's report.

"The closing rate in August was the highest since we began tracking this data three years ago," said Jonathan Corr, president and COO of Ellie Mae. "This was further indication that lenders are working every deal and making sure leads don't slip away."

Closings were higher purchase loans at a rate of 65.1 percent, though refinance closings also rose, climbing to a rate of 54.2 percent.

Meanwhile, purchase loans lost a small amount of ground, making up 66 percent of all closed loans, while refinance share ticked up to 33 percent as interest rates stayed more or less flat at an average 30-year rate of 4.39 percent.

As closing rates increased, so did the average amount of time it took to close a mortgage. According to Ellie Mae, the number of days to close rose to 39 in August from 37 in July, though that average was still shorter than most of the last 12 months.

Credit standards were unchanged from July among closed loans, with an average FICO score of 727 and an average loan-to-value ratio (LTV) of 82 percent. The average accepted LTV has remained stable for nine straight months now.

Among denied applications, the average FICO score was 695 in August, a small jump from 689 in July. The average denied LTV was 81 percent, unchanged.