Magazine article Mortgage Banking

Ellie Mae Finds Average Days to Close Dropping

Magazine article Mortgage Banking

Ellie Mae Finds Average Days to Close Dropping

Article excerpt

In new evidence that the housing market is rebounding from new rules for borrower disclosures, Ellie Mae's Origination Insight Report for March shows that the time to close for loans fell to the shortest time since March 2015. The average number of days it took for all types of loans to close fell to 44 in March. The report found that the average time it took to close a purchase loan fell from 48 days in February to 45 days in March. For refinance loans, the average time to close fell to 41 days in March from 44 days the month before. The average time to close for Federal Housing Administration (FHA) loans dropped to 44 days in March from 47 days in February. For home loans guaranteed by the Department of Veterans Affairs (VA), the average time to close fell to 48 days from 50.

The time it took for lenders to close home loans ballooned in the period right after new borrower disclosures took effect on Oct. 3, 2015. The Truth in Lending Act (TILA)-Real Estate Settlement Procedures Act (RESPA) Integrated Disclosure rule (TRID) made substantial changes to the disclosures borrowers must receive at loan application and at closing.

Ellie Mae's Origination Insight Report tracked the extra time that TRID implementation added to closing time frames. Refinance loans appear to have made the most progress in returning to faster closing time frames. The March report found that in March 2015, average days to close for refinance transactions was 45 days. The new report found average days to close for refinancings in March took 41 days. The average number of days to close for purchase loans in March 2016 was 45 days--up one day from year-ago levels. …

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