Ellie Mae Releases July 2013 Origination Insight Report

Purchase Activity Up in July as Underwriting Moderates

PLEASANTON, Calif.--(BUSINESS WIRE)-- Ellie Mae® (NYS: ELLI) , a leading provider of enterprise-level, on-demand automated solutions for the residential mortgage industry, today released its Origination Insight Report for July 2013. The report draws its data and insights from a robust sampling of the significant volume of loan applications—more than 20% of all originations in the United States—that flow through Ellie Mae's Encompass360® mortgage management software and the Ellie Mae Network™.


MONTHLY ORIGINATION OVERVIEW FOR JULY 2013

   

July 2013*

 

June 2013*

 

6 Months Ago
(January 2013)*

 

1 Year Ago
(July 2012)*

Closed Loans
Purpose
Refinance 47% 51% 73% 58%
Purchase 53% 49% 27% 42%
Type
FHA 19% 19% 18% 24%
Conventional 71% 71% 74% 67%
Days to Close
All 47 47 54 48
Refinance 48 47 55 48
Purchase 46 46 51 47
ARMs vs. Fixed, Length, Rate
ARM % 5.2% 4.0% 2.1% 3.1%
15 Year % 15.5% 16.5% 16.9% 15.3%
30 Year - Note Rate 4.357 3.918 3.634 3.870

*All references to months should be read as month ended.


PROFILES OF CLOSED AND DENIED LOANS FOR JULY 2013

  Closed First-Lien Loans   Denied Loans
  (All Types) (All Types)
FICO Score (FICO) 737 702
Loan-to-Value (LTV) 81 84
Debt-to-Income (DTI) 24/36 28/44

More information and analysis of closed and denied loans by loan purpose and investor are available in the full report at http://www.elliemae.com/about-us/news-reports/ellie-mae-reports/ .


To get a meaningful view of lender "pull-through," Ellie Mae reviewed a sampling of loan applications initiated 90 days prior (i.e., the April 2013 applications) to calculate an overall closing rate of 55.4% in July 2013, up from 54.3% in June 2013 (see full report).

"In July, the mix of purchase loans to refinances was 53% versus 47%: the largest percentage of purchase loans since we began tracking the data in August 2011," said Jonathan Corr, president and chief operating officer of Ellie Mae. "This was a further indication that housing seems to be improving.

"One part of the refinance market, HARP-related high LTV refinances (95% or more), had a resurgence, rising more than three percent to 11.1% in July 2013, compared to 8.0% in June 2013," he noted.

"Credit standards continued to ease in July," said Corr. "The average FICO score fell to 737, from 742 in June 2013, and it is now at the lowest level since we began our tracking in August 2011. Similarly we saw slight increases in both loan-to-value and debt-to-income ratios last month—signs that lenders are willing to accept slightly more risk to maintain volume.

"As the average 30-year fixed rate increased to 4.357% in July, ARM products have predictably become more popular, now 5.2% of closed loans, up from 4.0% in June," Corr said.

About Ellie Mae Origination Insight Report

In 2012, the total volume of mortgages that ran through Ellie Mae's Encompass360 mortgage management software was approximately three million loan applications, or 20% of all U.S. mortgage originations. The Origination Insight Report mines its application data from a robust sampling of approximately 44% of all mortgage applications that were initiated on the Encompass origination platform. Given the size of this sample and Ellie Mae's market share, the Company believes the Origination Insight Report is a strong proxy of the underwriting standards that are being employed by lenders across the country.

The Origination Insight Report focuses on loans that closed or were denied in a specific month and compares their characteristics to similar loans that closed or were denied three and six months earlier. The closing rate is calculated on a 90-day cycle rather than on a monthly basis because most loan applications typically take one and a half to two months from application to closing. Loans that do not close could still be active applications or applications withdrawn by consumers or denied for incompleteness or nonqualification.

The Origination Insight Report details aggregated, anonymized data and does not disclose client-specific or proprietary information.

News organizations have the right to reuse this data, provided that Ellie Mae, Inc. is credited as the source.

About Ellie Mae

Ellie Mae, Inc. (NYS: ELLI) is a leading provider of on-demand automation solutions for the mortgage industry. The Company offers an end-to-end solution, delivered using a Software-as-a-Service model that serves as the core operating system for mortgage originators and spans customer relationship management, loan origination and business management. The Company also hosts the Ellie Mae Network™ that allows Encompass® users to electronically conduct business transactions with the lenders and settlement service providers they work with to process and fund loans. The Company's offerings include the Encompass, Encompass360® and DataTrac® mortgage management software systems.

Ellie Mae was founded in 1997 and is based in Pleasanton, California. To learn more about Ellie Mae, visit www.EllieMae.com or call 877.355.4362.

© 2013 Ellie Mae, Inc. Ellie Mae ® , Encompass ® , Encompass360 ® , DataTrac ® , Ellie Mae Network and the Ellie Mae logo are registered trademarks or trademarks of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.

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