Mt Kisco Real Estate | Online Mortgages Come of Age

Introduced about 15 years ago, sites accepting online mortgage applications continue to increase market share. The latest data from an online lending leader suggests that today’s home buyers are shopping and applying for mortgages on the Internet a never before.

Mortgage applications nearly doubled in the first quarter of 2012 compared with the same period last year, according to MortgageMarvel.com, an online mortgage-shopping website that delivers real-time mortgage offers from multiple lenders and purchase mortgages were up about 40 percent over a year ago.

“The increase in online applications is a clear indication that home buyers are applying on line in greater numbers than ever, said Rick Allen, Chief Operating Officer of Mortgage Marvel, who noted that the spike in online applications far exceeded the 10 percent increase in purchase applications reported by the Mortgage Bankers Association for the first quarter.

Applicant credit scores averaged 733 in the first quarter of 2012 compared with 716 in the same period in 2011 and the average median household income of mortgage applicants rose from $79,400 to $87,450, indicating that lending standard may have tightened over the past year.

Mortgage Marvel data is compiled from loan applications submitted to lenders using Mortgagebot’s online lending platform. Mortgagebot, which owns and operates Mortgage Marvel, licenses its technology to over 1,100 lenders nationwide to facilitate mortgage applications through every delivery channel — consumer-direct via the Internet, in the branch or call center, or through professional loan officers. In 2011, more than 500,000 loan applications were submitted through Mortgagebot’s online lending platform. As a result, Mortgagebot has a rich database to use for analyzing interest rate and buying trends in the housing market.

Nationally, average interest rates for a 30-year, fixed rate, conforming mortgage climbed slightly during the first quarter of 2012 yet still remained at historically low levels. “On January 1, 2012, the average rate for this type of loan through our lender clients was 4.02 percent,” Allen said. “Rates reached a low of 3.92 percent on February 2 and a high of 4.18 percent on March 20. On March 30, the last business day of the quarter, the average rate stood at 4.06 percent.”

The consumer-estimated, average home price for applications in the Mortgage Marvel study was virtually unchanged, coming in at $267,204 in the first quarter of 2012 and $266,507 in the first quarter of 2011. The average loan amount fell slightly — from $188,528 to $185,223 — indicating a small increase in average down payment amounts.

“Things are improving, but, even though rates are at record lows, the total mortgage market in 2011 was less than a third of what it was in 2003 — roughly $1.2 trillion versus $3.8 trillion,” Allen said. “This shows just how much the housing and mortgage markets have been impacted by economic conditions.”