Mortgage rate locks fell 9% in August, Optimal Blue reports

Mortgage activity weakened in August even as mortgage rates stabilized, with total rate-lock volume falling 9% from July and 3% from a year earlier, according to Optimal Blue’s August 2026 Market Advantage report released Tuesday. Purchase lock volume declined 10% month over month but remained 6% above August 2025 levels. Purchase loans accounted for nearly 81% of total lock volume. Refinance activity remained weak. Rate-and-term refi volume fell 13% from July and 47% from a year earlier, while cash-out refi volume declined 3% month over month and 5% year over year. Refinances accounted for more than 19% of total production, up 40 basis points from July. “After a sharp move higher in July, rates leveled off in August, but that pause didn’t translate into stronger volume,” Brennan O’Connell, director of data solutions at Optimal Blue, said in a statement. “Purchase activity is still running ahead of last year, but with rate-and-term refinance volume down 47%, there just isn’t much refinance demand to support the broader market.” Mortgage spreads below 200 bps The Optimal Blue Mortgage Market Indices’ 30-year conforming fixed rate ended August at 6.72%, unchanged from July but 23 bps...