Days to Close Speeds Up
March 22, 2016
The average number of days to close a mortgage loan dropped to 46 days in February, from 50 days a month earlier and more in line with averages prior to new mortgage rules that took effect, according to Ellie Mae’s Origination Insight Report.
The drop in the average number of days to close on a loan could be one sign that lenders are getting adjusted to new mortgage rules. The new mortgage rules, which went into effect in October 2015, required new documentation to borrowers and some analysts said it slowed closings across the country the last few months.
The average of 46 days is now about the same average as of fall 2015, prior to the new rules taking effect.
More loans are closing too. The report also shows the closing rate for all loans was about 69.9 percent, up from 68.4 percent in January.
Read more: March Marks Modest TRID Progress
Delayed contracts represented about 30 percent of closed or terminated contracts in February, according to the REALTOR® Confidence Index, a survey of REALTORS® about their most recent transactions.
Of those who did see contract delays to settlement between December 2015 to February 2016, REALTORS® said the delays were due to:
- Issues related to obtaining financing: 42%
- Home inspection/environmental issues: 16%
- Appraisal issues: 16%
- Titling/deed issues: 11%
- Contingencies stated in the contract: 8%
- Issues in buy/sell distressed property: 8%
Source: “Number of Days to Close Fell Back to Pre-TRID Level in February,” Mortgageorb.com (March 17, 2016)
Updated: August 17, 2018