PERSON OF THE WEEK: The real estate finance world is not lacking data – from government agencies to ratings agencies to trade associations to private companies, the industry has a significant glut of statistics to plumb. However, there appears to be room for one more data resource: Pleasanton, Calif.-based Ellie Mae, which offers its own monthly analysis of industry trends.
This week, MortgageOrb speaks with Ellie Mae Chief Operating Officer Jonathan Corr about his company's new role as a source for industry data.
Q: Why is Ellie Mae now offering monthly housing data?
Corr: We have a tremendous amount of data going across the Ellie Mae platform – 20% of the national volume – and we've been talking about the opportunity to provide that data in order to give insight into what is going on in the industry.
As we looked across the mortgage banking landscape, we saw there was information on applications – the glimmer of the start of the process. There is a lot of information on rates, but not necessarily on the loans being closed. And there is a lot of data from later in the process, when somebody is 90 or 120 days in arrears. But there is nobody providing a glimmer of loans closing the previous months. We wanted to get a pulse of what's going on here and now.
Q: And what have you found so far?
Corr: There are loans being done. But the underwriting requirements are very strict and very tight – we've heard that anecdotally, but we confirmed that in our data.
Between August 2011 and March 2012, the actual characteristics of loan-to-value ratios (LTVs), debt-to-income ratios and trend scores have continued to inch up toward the quality side. The facts are – and the data backs this up – that you can get loans done. But if you don't have pristine quality or a reasonable amount of equity, it is going to be challenging to get a loan on the conventional side. On the Federal Housing Administration side, you have a little bit more flexibility and leeway.
Q: Have you come across any surprising findings in your data?
Corr: Nothing that really surprised me. As you look at data, you see it reaffirm what we've been hearing in marketplace. What is interesting is that the time to close loans went up at end of 2011 as we saw the refi surge. At the start of this year, that time frame went down.
Q: Are you planning to expand into more data-intensive endeavors, such as white papers or original research?
Corr: We initially put this out as a starting point to gauge interest from the market. As we go forward and hear different requests, we'll have an open mind about evaluating different things.
At this juncture, we're not charging for the data – we're sharing it with the industry and the media. As things evolve and people request different types of data, we'll evaluate where we'll take it.