The share of refinances originated during
a month dropped below 60 percent in April for the first time since September
2020. ICE Mortgage Technology, in its Origination Insight Report for the
month, put the share at 56 percent, down from 63 percent the following month.
The corresponding increase in purchase loans, 43 percent, was the highest since
The report also notes a further decline in
the average time to close all loans to 51 days. It was the fourth consecutive
decrease since January when closing time averaged 58 days. The 1 day decline
was due to a 2 day shortening of the purchase loan timeline to 49 days, offset
by refinancing time which ticked up 1 day to 52.
“The decrease in average time to
close is not surprising, given the increase we have observed in the adoption of
digital transformation tools, such as our artificial intelligence offering and
consumer engagement suite,” said Joe Tyrrell, president of ICE Mortgage Technology.
“This trend also aligns with findings from our [recent survey] in which both
borrowers and lenders noted that digital mortgage technologies are making it
faster and easier to close a mortgage loan, thus improving the overall
experience for participants.”
Conventional loans represented 81
percent of the month’s originations, down 2 percentage points from March. The
share of VA loans increased 3 points and FHA loans 1 point to 6 percent and 10
The closing rate for all loans increased
fractionally to 78 percent. Closing rates on refinances increased to
78.8 percent from 78.0 percent while the pull through on purchase loans fell to
76.7 percent from March’s 78.1 percent. ICE computes the closing or pull-through
rate from a sample of loan applications initiated 90
days prior, in this case in January 2021.
Data in the Origination
Insight Report is derived from a sampling of approximately 80 percent
of all mortgage applications that were initiated the ICE lending platform. The
company views the information as a proxy for the underwriting standards
employed by lenders across the country.