Ellie Mae Releases April Origination Insight Report

Ellie Mae® (NYSE MKT: ELLI), a leading provider of enterprise level, on-demand automated solutions for the residential mortgage industry, today released its Origination Insight Report for April 2012. The report draws its data and insights from a robust sampling of the significant volume of loan applications—more than 20% of all originations in the U.S.—that flow through Ellie Mae’s Encompass360® mortgage management software and Ellie Mae Network™.

MONTHLY ORIGINATION OVERVIEW FOR APRIL 2012

April2012

March2012

3 Months Ago(January 2012)

6 Months Ago(October 2011)

Closed Loans

Purpose

Refinance

        
        
           
        
        
          56%
        
        
           
        
        
          61%
        
        
           
        
        
          66%
        
        
           
        
        
          65%
        
      
      
        
          

Purchase

        
        
           
        
        
          44%
        
        
           
        
        
          39%
        
        
           
        
        
          34%
        
        
           
        
        
          35%
        
      
      
        
          

Type

FHA

        
        
           
        
        
          28%
        
        
           
        
        
          28%
        
        
           
        
        
          25%
        
        
           
        
        
          24%
        
      
      
        
          

Conventional

        
        
           
        
        
          62%
        
        
           
        
        
          64%
        
        
           
        
        
          67%
        
        
           
        
        
          69%
        
      
      
        
          

Days to Close

All

        
        
           
        
        
          45
        
        
           
        
        
          42
        
        
           
        
        
          48
        
        
           
        
        
          43
        
      
      
        
          

Refinance

        
        
           
        
        
          47
        
        
           
        
        
          42
        
        
           
        
        
          48
        
        
           
        
        
          42
        
      
      
        
          

Purchase

        
        
           
        
        
          43
        
        
           
        
        
          42
        
        
           
        
        
          47
        
        
           
        
        
          44
        
      
      
        
          

ARMs Vs. Fixed, Length, Rate

ARM %

        
        
           
        
        
          5.1%
        
        
           
        
        
          4.2%
        
        
           
        
        
          4.5%
        
        
           
        
        
          5.2%
        
      
      
        
          

15 Year %

        
        
           
        
        
          18.4%
        
        
           
        
        
          20.2%
        
        
           
        
        
          19.1%
        
        
           
        
        
          22.8%
        
      
      
        
          

30 Year – Note Rate

        
        
           
        
        
          4.151
        
        
           
        
        
          4.080
        
        
           
        
        
          4.181
        
        
           
        
        
          4.274
        
      
      
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
      
    
    
      
        
          

PROFILES OF CLOSED AND DENIED LOANS FOR APRIL 2012

Closed First-Lien Loans(All Types)

Denied Loans(All Types)

FICO Score (FICO)

        
        
           
        
        
          745
        
        
           
        
        
          702
        
      
      
        
          

Loan-to-Value (LTV)

        
        
           
        
        
          80
        
        
           
        
        
          87
        
      
      
        
          

Debt-to-Income (DTI)

        
        
           
        
        
          24/35
        
        
           
        
        
          28/43
        
      
      
        
        
        
           
        
        
        
        
           
        
        
        
      
    
    

More information and analysis of closed and denied loans, by loan purpose and investor, is available in the full report at http://www.elliemae.com/aboutus/about_reports.asp.

To get a meaningful view of lender “pull-through”, Ellie Mae reviewed a sampling of loan applications initiated 90 days prior (i.e., the January applications) to calculate a closing rate for April. Ellie Mae found that 48.1% of all applications closed in April compared to 46.9% in March (see full report).

“As we move into the spring and summer buying season, there was a significant pick up in the percentage of purchase loans: 44% in April up from 39% in March,” said Jonathan Corr, chief operating officer of Ellie Mae. “This is the highest level of purchase loans activity in the last nine months.

“In April, the average loan-to-value (LTV) for closed loans hit 80%, the highest we have seen since we started tracking in August 2011,” Corr added. “The increase was driven by an easing of LTVs on conventional refinances (the average LTV was 69% in April compared with 65% in March) and what we believe to be the first surge in Home Affordable Refinance Program (HARP) 2.0 activity from correspondent lenders.

“Last month closed refinances with LTVs of 95%-plus, nearly doubled to 7.1% compared to 3.6% in March. This has been slowly increasing since the HARP 2.0 announcement in October 2011, but correspondent lenders have only recently been able to run these loans through Desktop Underwriter and Loan Prospector.”

“Recently, the Wall Street Journal and other media outlets have been reporting that the nation’s largest retail lenders are now quoting long timelines for refinances—in some cases as long as 60 to 90 days,” said Corr. “While the average refinance going through our platform took five days longer in April than in March, it still only took 47 days. So, it appears that small and mid-sized lenders and community banks on our platform are providing faster decisions than the retail channels of some mega-lenders.”

About Ellie Mae Origination Insight Report

In 2011, the total volume of mortgages that ran through Ellie Mae’s Encompass360 mortgage management software was approximately two million loan applications, or 20% of all U.S. mortgage originations. The Origination Insight Report mines its application data from a robust sampling of approximately 33% of all mortgage applications that were initiated on the Encompass origination platform. Given the size of this sample and Ellie Mae’s market share, the Company believes the Origination Insight Report is a strong proxy of the underwriting standards that are being employed by lenders across the country.

The Origination Insight Report focuses on loans that closed or were denied in a specific month and compares their characteristics to similar loans that closed or were denied in the prior three-month and six-month periods. The closing rate is calculated on a 90-day cycle, rather than a monthly basis, because most loan applications typically take one and a half months to two months from application to closing. Loans that do not close could still be active applications, withdrawn by consumer, or denied for incompleteness or non-qualification.

The Origination Insight Report reports aggregated, anonymized data and does not disclose client-specific or proprietary information.

News organizations have the right to re-use this data, provided that Ellie Mae, Inc. is credited as the source.

About Ellie Mae

Ellie Mae, Inc. is a leading provider of on-demand automation solutions for the mortgage industry. The Company offers an end-to-end solution, delivered using a Software-as-a-Service model that serves as the core operating system for mortgage originators and spans customer relationship management, loan origination, and business management. The Company also hosts the Ellie Mae Network™ that allows mortgage professionals to conduct electronic business transactions with the lenders and settlement service providers they work with, to process and fund loans. The company's offerings include the Encompass®, Encompass360® and DataTrac® mortgage management software systems.

Ellie Mae was founded in 1997 and is based in Pleasanton, California. To learn more about Ellie Mae, visit www.EllieMae.com or call 877.355.4362.

© 2012 Ellie Mae, Inc. Ellie Mae®, Encompass®, Encompass360®, DataTrac®, Ellie Mae Network™ and the Ellie Mae logo are registered trademarks or trademarks of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.