Mortgage lock volume decreased 5.67% in July compared with June, according to Mortgage Capital Trading (MCT), continuing the trend established in May and June.
The secondary marketing software firm forecasts the trend will continue into August.
Even as rates gradually decrease, many potential buyers appear to be holding off in anticipation of potentially better rates later in the year.
Additionally, a potential September rate cut has already been priced into the market, suggesting that if the Federal Reserve does cut rates in their September meeting, it may have little effect on mortgage rates.
“Today’s nonfarm payroll report came in below expectations along with a higher than expected unemployment rate,” says Andrew Rhodes, senior director, head of trading at MCT. “If this trend continues, it is looking very likely the Federal Reserve will cut rates in their September meetings.”
MCT’s Lock Volume Indices present a snapshot of rate lock volume activity in the residential mortgage industry broken out by lock type (purchase, rate/term refinance, and cash out refinance) across a broad diversity of lenders (e.g., sizes, products/services offered, business models) from MCT’s national footprint.