Closing Times Lengthen Again
February 18, 2016
The time to close on a mortgage loan is once again increasing. The average time in January climbed to 50 total days, up four days since the "Know Before You Owe" mortgage disclosure rules took effect in October, shows a new report released by Ellie Mae.
Over the past year, the average time to close on a loan has grown 10 days longer. In January 2015, the average time to close was 40 days, according to Ellie Mae’s report.
The report also broke down average close times by type of loan:
- Purchase loans: 51 days (up from 50 days)
- Refinance loans: 48 days (up from 47 days)
- Federal Housing Administration loans: 51 days (up from 49 days)
- Conventional loans: 49 days (same)
- Department of Veteran Affairs loans: 53 days (up from 52 days)
Ellie Mae’s report also showed that despite closing times climbing, conventional purchase closing rates reached a new high in January. Conventional purchase closing rates increased above 73 percent for the first time since Ellie Mae began its tracking in August 2011.
Also, Ellie Mae’s report showed the average FICO score was down last month, averaging 719 on closed loans (down from 722 in December). That is also the largest month-to-month drop in FICO scores since mid-2015, Ellie Mae notes.
Source: “The TRID Ripples: Time to Close Mortgage Loans Continues to Rise,” HousingWire (Feb. 17, 2016)
Updated: May 28, 2020