LenderLogix’s second quarter (Q2) Homebuyer Intelligence Report offers insights into borrower homebuyer behavior during the pre-approval and borrower application process.
In Q2, borrowers generated 58,057 pre-approval letters through LenderLogix’s QuickQual pre-approval platform, an 8 percent increase from Q1. The average number of pre-approved borrowers per loan officer increased from 25 in Q1 to 29 in Q2.
The average pre-approval letter loan amount decreased from $309,771 in Q1 to $308,681 in Q2. However, the average sales price increased from $358,175 to $362,780. The average down payment size changed, increasing from 13.6 percent in Q1 to 14.6 percent.
Conventional loans remained the most popular loan type for pre-approved borrowers, staying consistent at 76 percent. FHA pre-approvals increased from 17.6 percent to 17.8 percent. VA (4 percent) and USDA share (1 percent) maintained their share from Q1 to Q2.
“Overall borrower activity has stayed consistent in 2024,” LenderLogix Co-Founder and CEO Patrick O’Brien said. “Given these steady numbers, loan officers leveraging our products have been able to maintain steady business and origination levels. With QuickQual’s conversation rate at 58 percent and the average per fee collection size at $646, loan officers are continuing to focus on what’s working for them in the current market.”
Of the borrowers using QuickQual in Q1, the average number of days between pre-approval and loan submission increased nearly 8 percent to 85 days compared to 78.29 days the previous quarter. The most prolonged duration between pre-approval and application decreased from 699 days in Q1 to 603 days. Despite this significant change, the conversion from borrowers using QuickQual to loan application increased slightly to 58 percent from 57 percent in Q1. Within this subset, borrowers generated an average of 8.7 pre-approval letters before converting.
“While the Federal Reserve’s decision to hold on rate cuts until possibly later in the year may have dampened lenders’ expectations, borrowers seem to have come to terms with the current state of interest rates and are committed to buying, though perhaps not to the same degree as in previous purchase cycles,” O’Brien noted. “The lesson we’ve observed through the first half of 2024 is that there is business to be had, but lenders may need to dig deeper to find it.”