LOS Helps Lenders Reach Millennial Borrowers

As lenders scramble to get new borrowers, and younger borrowers, a good LOS should be there to help in this process. For example, Ellie Mae has launched the Ellie Mae Millennial Tracker, a new interactive online tool on millennial loan trends in the United States. Here’s how it works:

An online tool, which will be refreshed with new data the first week of each month, the Ellie Mae Millennial Tracker provides access to up-to-date demographic data about this new generation of homebuyers. Searches can be tailored by borrower geography, age, gender, marital status, FICO score and amortization type. The Ellie Mae Millennial Tracker mines data from a robust sampling of approximately 66 percent of all closed mortgages dating back to 2014 that were initiated on Ellie Mae’s Encompass solution. Given the size of this sample and Ellie Mae’s market share, it is a strong proxy of millennial mortgage indicators across the country.

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March data from the Millennial Tracker showed that women were listed as the primary borrower on 31 percent of closed loans. The average primary FICO score for female loan applicants was 724 and the average age was 30. By comparison, men were listed as the primary borrower on 66 percent of closed loans and had an average age of 29 and an average FICO score of 727.

“The mortgage industry is poised to experience a monumental shift as more millennial homebuyers begin to enter the market,” said Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. “There are roughly 87 million would-be homebuyers in the millennial generation and 91 percent of them say they intend to own a home one day. Lenders must prepare today to meet their needs.”

“Our new Ellie Mae Millennial Tracker gives mortgage lenders perspective into the next generation of homebuyers in order to better serve them, and ultimately help make their homeownership dreams a reality,” added Tyrrell.

Thirty seven percent of mortgages made to millennial homebuyers since 2014 were FHA loans and took an average of 44 days to close. Conventional loans represented 60 percent of the loans made to millennials during the same period and took an average of 43 days to close.

MILLENNIAL TRACKER HIGHLIGHTS FOR MARCH 2016

Loan Type Percentage of Loan Type Average Primary FICO  Average Days to Close
Conventional 59%   749   42
FHA 38%   692   43

The Ellie Mae Millennial Tracker is a supplement to Ellie Mae’s monthly Origination Insight Report, which focuses on loans that closed in a specific month and compares their characteristics to similar loans that closed three and six months earlier. The Origination Insight Report will continue to be released on the third Wednesday of each month.

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