Optimal Blue report: Mortgage demand strengthens as purchase activity and pull-through rebound

Purchase locks reached their highest level since early spring as pull-through rates rebounded and non-conforming lending climbed to a multi-year high

PLANO, Texas, July 9, 2026 (SEND2PRESS NEWSWIRE) — Optimal Blue today released its June 2026 Market Advantage mortgage data report, which found that mortgage activity strengthened month over month (MoM), with purchase lock volume climbing to its highest level since early spring and pull-through rates rebounding across both purchase and refinance pipelines. Total rate-lock volume rose 10% MoM and 15% year over year (YoY). June also extended recent shifts in product mix, with non-conforming lending reaching its highest share in several years as conforming volume remained below 49% for the second consecutive month.

Image caption: Optimal Blue’s June 2026 Market Advantage mortgage data report.

Mortgage rates were mixed in June. The Optimal Blue Mortgage Market Indices (OBMMI) 30-year conforming fixed rate, the benchmark for CME Group’s Mortgage Rate futures, edged up 1 basis point (bp) MoM to 6.45%, remaining 22 bps lower than June 2025. The 10-year Treasury yield closed the month at 4.44%, down 1 bp MoM, while the spread between the 10-year Treasury and the OBMMI 30-year conforming rate widened to 201 bps.

“June wasn’t defined by a single headline number. Purchase demand strengthened, refinance activity held up and pull-through improved after softening in May,” said Mike Vough, senior vice president of corporate strategy at Optimal Blue. “Together, those trends point to a market that is battle tested and that has adapted to a higher-for-longer rate environment.”

On the secondary side, lenders continued to balance execution options as agency mortgage-backed security (MBS) executions declined for the second consecutive month to 40% of funded loan sales, while best-efforts activity increased to 3%. Execution spreads also moved in different directions, with conventional 30-year best-efforts-to-mandatory spreads tightening to 31 bps and government 30-year spreads widening to 18 bps. Mortgage servicing rights (MSRs) for conforming 30-year loans declined to 1.33% in June.

“We saw lenders continue to fine-tune execution strategy in June,” Vough said. “Agency MBS executions declined again while best-efforts activity increased showing that lenders are evaluating all potential loan sale options, and best efforts-mandatory pricing spreads moved in opposite directions for conventional and government loans. It shows lenders must continue to evaluate execution opportunities on a product-by-product basis.”

KEY FINDINGS FROM THE MARKET ADVANTAGE REPORT, DERIVED FROM DIRECT-SOURCE MORTGAGE LOCK AND SECONDARY MARKET DATA, INCLUDE:

Volume trends and market composition

• Refis hold steady: Refinance share remained essentially unchanged at 19% of total lock volume in June, materially higher than levels seen throughout much of 2025. Cash-out refinance volume grew 11% MoM and 10% YoY. Rate-and-term refinance volume increased 6% MoM and 32% YoY.
• Purchase momentum builds: Purchase lock volume increased 10% MoM and 14% YoY, reaching its highest level since early spring. Purchase loans accounted for more than 81% of total lock volume in June.
• Conforming stays below 49%: Conforming share declined to 49% of total production in June, extending the decline that first pushed it below 50% in April. Non-conforming lending expanded to more than 19% of volume, its highest share in several years. FHA represented nearly 19% of production, while VA loans accounted for almost 13%.
• Non-QM remains elevated: Non-qualified mortgage loans accounted for 9% of total lock volume in June, 1.4 percentage points higher than a year ago.
• New construction strengthens: Planned unit developments (PUDs), a proxy for new construction activity, increased to 28% of total volume. Single-family detached homes remained the dominant property type at 64% of production. Condo share held at 6%.

Rates and pricing

• Mortgage spread tops 200 bps: The OBMMI 30-year conforming fixed rate increased 1 bp MoM to 6.45%, down 22 bps YoY. The 10-year Treasury yield closed at 4.44%, down 1 bp MoM. The spread between the 10-year Treasury and the OBMMI 30-year conforming rate widened to 201 bps, remaining above long-term averages despite narrowing from year-ago levels.
• MSRs edge lower: MSRs for conforming 30-year loans declined 3 bps to 1.33%, representing a 5.32 multiple.
• Conventional and government spreads split: Best-efforts-to-mandatory spreads for conventional 30-year products tightened 9 bps to 31 bps. Government 30-year spreads widened 6 bps to 18 bps.
• Top-tier executions increase: The share of loans sold at the highest price tier increased 78 bps to 78%. Loans sold at the second- and third-ranked price tiers each declined 93 bps and 25 bps to 12% and 3%, respectively. Fourth-tier-or-lower executions increased 40 bps to 7%.

Channel and execution

• Agency MBS executions decline for second consecutive month: Hedged loan sales to agency MBS declined 1 percentage point to 40% of funded loan sales.
• Best-efforts activity picks up: Cash and bulk aggregator executions held flat while best-efforts executions increased from 2% to 3% of funded loan sales.
• Investor count plateaus: Investor participation held at 14 for the second consecutive month after reaching 15 in April.

Product mix and borrower profiles                          

• First-time buyers regain ground: First-time homebuyers accounted for 45% of conforming purchase locks in June, nearly 3 percentage points above year-ago levels. FHA first-time homebuyer share remained elevated at 69%.
• DTI ratios remain below year-ago levels: Purchase debt-to-income ratios held below 2025 levels across all major products: conforming borrowers at 36.6%, FHA at 43.5% and VA at 43.0%, suggesting affordability has modestly improved relative to last year despite higher home prices.
• Borrower credit quality holds steady: The average credit score held at 731, ranging from 757 in the San Francisco Bay Area to 716 in San Antonio. Conforming borrowers averaged a score of 753.
• Pull-through stays strong: Purchase pull-through increased to 81.4% in June, recovering from May’s decline. Refinance pull-through also climbed to 71.1%.
• Loan amounts near $400K again: The average locked loan amount increased to just over $399,000 in June, near record highs as home prices continue to appreciate and purchase activity remains concentrated in higher-cost markets. Average loan-to-value (LTV) ratios nationwide were 81.4%, ranging from 71.0% in the greater Los Angeles area to 88.8% in San Antonio.

To view the full June 2026 Market Advantage report, complete the free subscription form: https://engage.optimalblue.com/market-advantage.

Subscribers receive a report PDF each month with the latest data. Members of the press are eligible for special, advance access each month and should contact Alexandra Kreuter to be added to the media list.

About the Market Advantage Report

Optimal Blue issues the Market Advantage mortgage report each month to provide insight into U.S. mortgage trends and drivers of lending profitability. Data is sourced from the Optimal Blue PPE, which is used to price and lock more than one-third of all mortgages nationwide, and Optimal Blue’s hedging and loan trading system, which supports approximately 40% of loans hedged and sold into the secondary market. As the leader in mortgage capital markets technology, Optimal Blue has a direct view of both origination and secondary market activity and the interconnectedness of the two. Unlike self-reported survey data, Optimal Blue’s direct-source data accurately reflect the in-process loans in lenders’ pipelines and secondary market executions. Visit Optimal Blue’s website to subscribe to receive the free report each month.

Nothing herein shall be construed as, nor is Optimal Blue providing, any legal, trading, hedging or financial advice.

About Optimal Blue

Optimal Blue powers profitability across the mortgage capital markets ecosystem. As the industry’s only end-to-end capital markets platform, our technology, data and integrations bridge the primary and secondary markets to help lenders of all sizes maximize performance – from pricing accuracy to margin protection and every step in between. Backed by over 20 years of proven expertise, our modern, cloud-native technology delivers the real-time automation, actionable data and seamless connectivity lenders need to navigate market volatility and scale for growth. To learn more about how Optimal Blue delivers measurable ROI, visit OptimalBlue.com.

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Image caption: Optimal Blue’s June 2026 Market Advantage mortgage data report

NEWS SOURCE: Optimal Blue

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