Refis were 40% of all loans closed in December
The percentage of refinances grew to 40% of all closed loans in December, according to Ellie Mae's Origination Insight Report.
Total refinance loans increased a percentage point from 39% in November and seven percentage points from June, but were still down from 46% from the same period a year ago.
The percentage of Federal Housing Administration loans grew to 25% from 22% year-over-year and from 24% month-over-month, while the share of conventional refinances declined to 47% from 56% in December 2016, but increased from 45% in November.
"As we closed out 2017 we saw an increase in the percentage of refinances due to seasonality as fewer purchases take place in the fourth quarter, and likely homebuyers were taking advantage of the mortgage deductibility limit before it decreased to $750,000 on Dec. 15," said Jonathan Corr, president and CEO of Ellie Mae, in a press release.
"We probably can also attribute some of the increase in closing rates to last-minute efforts by borrowers to close loans before the tax changes took effect," he continued.
The time to close all loan types shrunk across the board, dropping to 44 days in December from 50 during the same period a year ago. The time to close refinance loans fell from 52 days to 41, and the time to close purchase loans declined from 48 days to 46 year-over-year.
Closing rates increased monthly in December, with closing rates on all loans growing to 71.2% from 70.9% in the previous month. The closing rate for refinance loans increased to 65.6% from 65.1%, and for purchase loans grew to 76.1% from 75.5% in November.