SAN DIEGO, Calif. /California Newswire/ — Mortgage Capital Trading, Inc. (MCT®), the leader in capital markets software and services supporting more lenders with hedging and pipeline management solutions than any other single provider, is pleased to present the MCTlive! Lock Volume Indices for May 2023. MCT Data represents a balanced cross section of several hundred lenders among retail, correspondent, wholesale, and consumer direct channels. A broad-based view of the entire market provides a more accurate picture of mortgage originations versus indices that are influenced by mega lenders. The May MCTlive! Lock Volume Indices is broken out by transaction type: purchase, rate/term refinance, and cash out refinance.

MCT: Figure 1: Lock volume for May 2023 broken out by transaction type
MCT: Figure 1: Lock volume for May 2023 broken out by transaction type

May MCTlive! Lock Volume Indices shows that overall lock volume had a stronger downturn in May, compared to the lighter downturn in April. Purchase lock activity was down 15.20% compared to April. Rate/term refinance volume was down 21.88%, and cash-out refinance volume was down 21.77%. Lock activity in total was down 15.87% in total compared to April.

In general, May had a stronger downward trend compared to April, but we should see lock activity begin to climb as the Fed decides if they’ve reached their terminal Fed funds rate and we move into the Spring. As it stands, total lock activity is down 29.09% from last year. Purchase lock activity sits 23.23% lower than at the same point last year. Rate and term refinance volume is down 41.85% from one year ago, and cash-out refinance volume is down 71.83% over that same period.

It is important to note that MCT’s rate lock activity indices are based on actual dollar volume of locked loans, not number of applications. Especially in a tight purchase market, MCT believes its methodology (using actual loans locked vs. applications) is a more reliable metric. There is a higher likelihood of having multiple applications per funded loan, and prequals do not convert at as high of a rate in the current market as has historically been the case – especially when applications are counted at the early stage of entering a property address.

* Index values to end May as a percentage benchmarked to the start of the month

Category: Month-Over-Month Index Value Change
Total: -15.87%
Purchase: -15.20%
Rate/Term Refinance: -21.88%
Cash Out Refinance: -21.77%

* Index value change year-over-year

Category: Month-Over-Month Index Value Change
Total: -29.09%
Purchase: -23.23%
Rate/Term Refinance: -41.85%
Cash Out Refinance: -71.83%

MCT will be publishing the MCTlive! Mortgage Lock Volume Indices monthly, intending the data to serve as an enduring informational tool for industry participants, analysts, and watchers.

About MCT:

Founded in 2001, Mortgage Capital Trading, Inc. (MCT) ® has grown from a boutique mortgage pipeline hedging firm into the industry’s leading provider of fully integrated capital markets services and technology. MCT’s offerings include mortgage pipeline hedging, best execution loan sales, business intelligence and analytics, outsourced lock desk solutions, MSR valuation, hedging, and bulk sales, and the world’s first, truly open marketplace for loan sales.

MCT supports independent mortgage bankers, depositories, credit unions, warehouse lenders, and correspondent investors of all sizes within its award-winning digital platform, MCTlive! ®. Headquartered in sunny San Diego, MCT also has offices in Healdsburg, CA, Philadelphia, PA and Texas.

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