The Federal Government and the enterprises that it sponsors have been putting in effort over the last year and a half to make more lending available to more people. According to an article by the Housing Wire, these entities have taken steps to open up the credit box.
A new report by Ellie Mae, a software company that processes almost a quarter of U.S. mortgage applications, shows that these efforts may be making progress. It is becoming easier to get a mortgage, and as a bonus: rates are still low.
The 30-year fixed-rate mortgage remains below 4 percent. The average rates were 3.79 percent nationwide last week according to Freddie Mac. This is down from 3.98 percent a year ago. Fifteen-year-fixed rate mortgages were down from 3.13 percent last year to 2.98 percent.
According to Ellie Mae’s most recent Origination Insight Report, which uses a sample from the approximately 66% of all mortgage applications that were initiated on the Encompass mortgage management solution, the credit score on closed loans in September fell to the lowest level since Ellie Mae began collecting the data in August 2011. The average FICO score for closed loans has also fallen throughout the year. It was 723 in September, down from 731 in January. It was also down one point from August.
“Average credit scores declined to the lowest levels we’ve seen since 2011,” said Jonathan Corr, president and CEO of Ellie Mae. “We are also seeing rates fall while the time to close is also decreasing. It will be interesting to see if these trends continue as we begin to see impacts from TRID.”
66 percent of all loan applications closing for the third consecutive month, which is high rate. The closing rate on purchase loans rose to 71 percent. Also, the time to close on all loans dropped for the fourth consecutive month to 46 days.
With more lending available to more people now, it is easier for homebuyers to get finances for their purchase. If you have been eyeing your dream home in Miami but worried about financing, your break may be here! Contact a RE/MAX Paradise agent with any questions!