ICE: 1Q Sees Significant Reduction in Time to Close
(Chart courtesy ICE Mortgage Technology.)
ICE Mortgage Technology, Pleasanton, Calif., said time to close all loans decreased over the first quarter, from 58 days in January to 52 days in March.
The company’s monthly Origination Insight Report said time to close all purchase loans decreased over the quarter, from 57 days in January, 53 days in February and 51 days in March. Refinances saw similar decreases in days-to-close, falling from 59 days in January to 52 in both February and March.
“We’re seeing a compelling reduction in the time to close a mortgage as we continue into 2021,” said Joe Tyrrell, president of ICE Mortgage Technology. “Part of the reason is lenders are continuing to adopt digital mortgage tools to improve their loan origination process and serve homebuyers more efficiently, for example eClose, which makes for a more streamlined process that saves time, and that shift is showing up in the data.”
The report said closing rates increased slightly for the month on all loans, from 76.4 percent in February to 77.9 percent in March, while and closing rates on refinances increased from 76.3 percent to 78.0 percent month-over-month. Closing rates on purchases increased from 77.1 to 78.1 percent, respectively.
The percentage of refinances dropped from 68 percent of all closed loans in February to 63 percent of all closed loans in March. The percentage of purchases increased to 36 percent of total closed loans for the month of March, up from 32 percent the month prior.
“After months of near record numbers of refinances, it is clear that the pandemic has shifted how people view their homes and in doing so, prompted homeowners to refinance, often in order to access the equity,” Tyrrell said. “As we enter the summer home buying months, if we continue to see higher than normal refinance volumes, as some homeowners commit to staying in their current homes, it will mean new buyers face an even more competitive purchase market driven by tight supply.”