Borrowers generated 8.61% fewer pre-approval letters through LenderLogix‘s QuickQual pre-approval platform in the third quarter compared with the second quarter, according to the firm’s latest Homebuyer Intelligence Report.
The average loan amount on pre-approval letters was $328,997 in the third quarter, down from $367,305 in the second quarter.
However, the average down payment percentage moved in the opposite direction, rising from 13.3% to 14.7% as borrowers brought more funds to the table.
Conventional loans remained the most popular loan type for pre-approved borrowers, decreasing marginally to 74.6%, down from 74.7% in the second quarter.
FHA pre-approvals increased marginally to 18.7%, up from 18.6%.
VA pre-approvals decreased slightly to 4.2%, down from 4.5%.
USDA pre-approvals were flat at 1%.
“Despite a modest seasonal decline in pre-approval activity and loan amounts, borrowers are signaling seriousness through larger down payments and steady interest across loan types,” says Patrick O’Brien, co-founder and CEO for LenderLogix, in the report. “These trends point to a purchase market that is more price-conscious but still active.”
Of the borrowers using QuickQual in the third quarter, the average number of days between pre-approval and loan submission increased from 86.3 to 89.5 days in third quarter.
From pre-approval to loan application, the conversion rate among borrowers held steady at 56%.
“Borrower conversion remained steady this quarter, even though the timeline between pre-approval and loan submission lengthened,” O’Brien says. “This suggests that homebuyers are staying engaged despite navigating longer home search cycles.”
Photo: Drahomír Hugo Posteby-Mach