Ellie Mae: Credit Easing, HARP 2.0 Staying the Course
Ellie Mae’s latest monthly origination data suggest credit standards are easing and Home Affordable Refinance Program 2.0 momentum persists.
“The average FICO dropped from 749 in January 2013 to 745 in February 2013, the lowest point since May 2012. Meanwhile, the average loan-to-value hit 80% for the first time since July 2012 and the backend debt-to-income ratio was 35% for the first time since June 2012––suggesting that the credit box may be expanding,” said Jonathan Corr, president and chief operating officer of the origination technology provider, in a press release.
Corr added, “HARP 2.0 continues to show traction with conventional refinances at 95%-plus LTV rising for the sixth month in a row to 12.1% in February 2013, the highest level since we began tracking in October 2011.”
He said the data, which are drawn from a sampling of approximately 44% of all mortgage applications initiated on the Encompass origination platform during the month, also show “the purchase market is strengthening as the run-up begins for the spring buying season, rising from 27% of all closed loans in January 2013 to 32% in February 2013.”
Corr said the numbers also show “time to close improved considerably, dropping to 50 days in February 2013 from 54 days in January 2013.”