MReport November 2017

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TH E M R EP O RT | 49 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Will Millennial Homebuying Trends Continue? A least one area, conventional loans, stayed the course, holding at 64 percent of all closed loans by millennial buyers. A lthough interest rates didn't show any signs of dropping digits over the summer season, that didn't seem to deter home - buyers, according to August data logged by Ellie Mae's Millennial Tracker and released in October. Conventional loans stayed the course, holding at 64 percent of all closed loans by millennial buyers. Also keeping with the status quo, FHA mortgages hovered at a mar - ket share of 32 percent—the same figure that agency has been post- ing since June, the report noted. Additionally, the average dol- lar amount for loans closed by millennial borrowers in August tallied $185,919, a negligible uptick from the $184,113 recorded in August 2016. This was notwith - standing the fact that the average 30-year note increased to 4.211 percent from 3.706 percent in 2016. The average millennial primary borrower was a 29.4-year-old who used their $185,919 conventional loan to purchase a home with an average appraised value of $223,882. This person had a FICO score of 724, which enabled them to secure their 4.211 percent loan. They closed on their home in 44 days. The majority (64 percent) of primary borrowers were male, and more than half (52 percent) were married. On the West Coast, the aver - age millennial borrower was a bit older—30.6—and took out a loan of $314,579 on average. In the Midwest, however, average loan amounts trended lower. For instance, homebuyers of age 29.5 in Kansas closed loans averag - ing $158,584. Island-hopping over to Hawaii, the average borrower there was a 31.4-year-old taking out a $396,766 loan. On the whole, millennials were most likely to close loans for the purpose of purchasing a home (87 percent). Refinances made up 12 percent of loans closed by millen - nials in August. "Average loan amounts in August of this year were slightly higher than last year, despite higher interest rates," said Joe Tyrrell, EVP of Corporate Strategy for Ellie Mae. "As tends to happen with tight inventories, this is a seller's market, and many of today's homebuyers may be faced with paying a premium for the same home they might have bought for less last year. For those who are committed to buying a home, though, slight increases in competition, costs, or interest rates will likely not deter them." These Cities are Best at Money Management According to LendingTree, the residents of these cities are the best in the country at living within their means. T hough 40 percent of Americans say they're struggling to make ends meet, it seems residents of Greenville, South Carolina, have their finances pretty well figured out. Ac - cording to a new analysis from LendingTree, Greenville resi- dents are the best in the coun- try at living within their means. LendingTree's analysis, which looked at household income, mort- gage balances, number of credit inquiries, use of revolving credit, and nonhousing debt, ranked the nation's top 50 metro areas by "how successfully residents are spending within their means." Greenville took the No. 1 spot, despite having the second-lowest household income out of all 50 cities. Residents are using just over 27 percent of their revolving credit, and their housing debt balances average just 62 percent of their income—a big dip compared to the 50-city average of 79 percent. Greensboro, North Carolina, and Kansas City, Missouri, took the No. 2 and No. 3 spots on the list. Greensboro residents have less than four credit inquiries in the last two years, while those in Kansas City have less debt (both housing and nonhousing) than the 50-city average. LendingTree also ranked the cities where residents are worst at living within their means, and topping the list was San Antonio. According to analysis, residents of the historic Texas town use lots of revolving credit, have high debt balances, and take out bigger installment loans. "San Antonio residents have nonhousing debt balances that represent 55 percent of their an - nual income, the highest of the 50 metros analyzed," LendingTree reported. "Big loans for cars and trucks could be a factor, with San Antonio residents having an aver - age balance of $30,599 in install- ment loans, the highest of the metros analyzed and 26 percent above the average." Las Vegas and Phoenix were also ranked at the bottom of the list. Overall, the average resident in the 50 ranked cities uses about 30 percent of their revolving credit availability, which includes home equity lines of credit and credit cards. "They also have mortgage bal - ances averaging 79 percent of their annual income and nonhousing debt balances averaging 44 percent of annual income, and have had five credit inquiries in the last two years," LendingTree reported. On the whole, millennials were most likely to close loans for the purpose of purchasing a home (87 percent).

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