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32 REFIS HEATED UP IN Q4 2017 When it came to their mortgages in the last quarter of 2017, a bevy of millennials jumped on the refi bandwagon. As a result, refinances reclaimed their popularity in December, Ellie Mae reports in its latest Millennial Tracker. December was the third straight month in which refinances made up 15 percent of all closed loans for millennial borrowers, the report says. at's the highest percentage of refis recorded for this group since February 2017's yearly high of 17 percent. e percentage of closed purchase loans hovered at 84 percent, the report notes, dropping from the 90 percent peak posted in June 2017. As for conventional refinanced mortgages, those have been chugging along at 19 percent since October, the report says. FHA refi loans, on the other hand, remained at six percent from the previous month. Added together, the percentage of conventional and FHA purchase loans also stayed the same from November to December, coming in at 80 and 94 percent, respectively. Joe Tyrrell, Ellie Mae's EVP of Corporate Strategy, sounded off on the potential motivations underlying the numbers. "With seasonality and low inventory levels at the end of the year, millennial borrowers continued to take advantage of refinance options during the fourth quarter," he said. "Many may have been driven by a desire to take advantage of low interest rates given uncertainty about potential rate hikes in the new year." e average 30-year note inched up a tad from 4.18 in November to 4.22 in December— still below 2017's highest monthly average of 4.34 in April. e average time to close all loans persisted at 44 days in December. Average time to close a refi camped out at 45 days, while the time to close a purchase also remained at 42 days, the same since June 2017. Finally, average FICO scores for all closed loans slipped one point from the preceding month to 722. e top Metropolitan Statistical Areas (MSAs) for millennials by percentage of mortgage loans closed in December were Casper, Wyoming (71 percent); Williston, North Dakota (63 percent); and Victoria, Texas, and Mount Pleasant, Michigan (both at 61 percent). MORTGAGE CREDIT AVAILABILITY JUMPS Mortgage credit availability increased by 2.1 percent to 182.9 points in January according to Mortgage Credit Availability Index (MCAI) data. e MCAI, a report from the MBA, analyzes data from Ellie Mae's AllRegs Market Clarity business information tool and an increase in the data indicates loosening credit while a decline suggests tightening lending standards. e MCAI is calculated using several factors related to borrower eligibility such as credit score, loan type, loan-to-value ratio, etc. ese metrics and underwriting criteria for over 95 lenders/investors are combined to calculate the MCAI, a summary measure which indicates the availability of mortgage credit at a point in time. e Conventional, Government, Conforming, and Jumbo MCAIs are constructed using the same methodology as the Total MCAI and are designed to show relative credit risk/availability for their respective index. e Government MCAI examines FHA/VA/ USDA loan programs, while the Conventional MCAI examines non-government loan programs. According to the data, Conventional MCAI rose 3.6 percent and was more than the Government MCAI which increased by 0.9 percent in January. Jumbo MCAI and Conforming MCAI are components of the Conventional MCAI. While Jumbo MCAI examines conventional programs outside conforming loan limits, the Conforming MCAI examines conventional loan programs that fall under conforming loan limits. e component indices of the Conventional MCAI increased from the prior month with Jumbo MCAI making the most gains, rising 6.1 percent, driven by an increase in the number of programs with reduced documentation requirements for Jumbo credits. In contrast, the indices on the Conforming MCAI were up 1.1 percent. "Credit availability increased across the board in January, more than reversing December declines in almost all component indices. Jumbo credit programs rebounded most strongly and reached a new series high, driven by an increase in the number of programs with reduced documentation requirements," said Lynn Fisher, VP, Research and Economics at MBA.

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