Mortgage refinance loans accounted for 38% of all closed loans in September, according to Ellie Mae, the leading cloud-based platform provider for the mortgage finance industry. The increase in refinance loans was most likely because of low interest rates, which dipped to 4.21%, the lowest they’d been this year.
While mortgage refinance loans were up by 3% from August and 1% from six months ago, they were actually still down from last September’s rate of 45%.
Approximately 14% of all refinance loans in September were taken out by Millennial borrowers, according to the Ellie Mae Millennial Tracker. This was the highest percentage attributed to Millennials since this past February.
The percentage of conventional refinance mortgage loans taken out by Millennials rose by 2% in September from August to 17%, while Millennials taking out FHA refinance loans rose from 4% to 5% in September, and VA refinance loans from 28% to 30% for the month.
“With average interest rates falling to their lowest point in 2017, Millennials are taking advantage of refinance opportunities,” said Joe Tyrrell, executive vice president of corporate strategy for Ellie Mae. “While we are also seeing Millennials with more purchase power, the uptick in refinances indicates maturity among those Millennials who previously purchased a home and are looking for an opportunity to lower their monthly interest payments.”
According to Ellie Mae, the majority of the Millennial primary borrower refinancing their homes in September were male; the average age was 31.5 years old. Two-thirds of the Millennials who refinanced their homes were married, while about one-third were single.
The Ellie Mae Millennial Tracker is a free interactive online tool that provides access to up-to-date demographic data about homebuyers in the Millennial generation. Users can complete searches for based on borrower geography, age, gender, marital status, FICO score and amortization type.
The tracker mines data from a robust sampling of approximately 80% of all closed mortgages initiated on Ellie Mae’s Encompass® all-in-one mortgage management solution, dating back to 2014. According to Ellie Mae, because of its strong market share and the size of the sample, the data is a strong proxy of Millennial mortgage indicators across the country.
Acuity National Real Estate Solutions is a national title agency offering cutting-edge tools to help lenders reduce costs, streamline closings and increase compliance. If you’re a lender who would like more information, please contact us today!