Mortgage Volume Down Despite Lower Rates

Mortgage rates dipped last week to 4.84 percent from 4.86 percent, but total mortgage application volume dropped as well, down 2.9 percent.

According to the Mortgage Bankers Association, volume was down 10 percent year-over-year, and CNBC reports that last week was the sixth consecutive week for volume decreases. Joel Kan, an associate vice president for the MBA says, "Rates slipped slightly over the week as concerns over U.S. trade policy and global growth sent some investors back to safer U.S. Treasurys. Minutes from the most recent FOMC meeting also yielded a more dovish tone, which added to the downward pressure in rates."

Mortgage rates moved even lower to start this week, as a sell-off in the stock market caused a run on bonds. Political uncertainty in Italy unnerved global markets. Over the weekend Italy's president stopped the formation of a coalition government that may have sought to leave the euro. That had investors worried about the strength of the euro zone ... Said Matthew Graham, chief operating officer at Mortgage News Daily, "It's a big 'if' to entertain the possibility that an Italian EU exit could overshadow all the headwinds for interest rates, even though it hits big in terms of shorter-term drama."

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