Home loan applications fell greatly recently as greater loaning expenses continued to push refinance demand, while purchase activity revealed a bit more resilience. The Mortgage Bankers Association (MBA) reported an 8.5% decrease in total application volume on a seasonally adjusted basis for the week ending May 22.
The decline was driven mostly by a steep drop in refinance activity. The Refinance Index fell 18% from the previous week, though refinance demand stayed 19% greater than the very same duration one year earlier.
Purchase activity held relatively consistent despite the rate environment. The seasonally changed Purchase Index slipped just 0.4% week over week and stayed 5% above year-ago levels.
The typical 30-year set mortgage rate increased to 6.65% from 6.56%, reaching its greatest level because August 2025. MBA’s Joel Kan keeps in mind the constant climb in rates over the past five weeks pressed many customers out of the refinance market.
Additionally, Kan stated refinance activity weakened across almost every classification last week, keeping in mind that “traditional refinances were down 14 percent, in addition to an 18 percent decrease for FHA applications and a 34 percent decline for VA applications.” He added that re-finances represented just 37.5% of total mortgage activity, “the most affordable share because June 2025.”
Looking ahead to next week’s information, it wouldn’t be a surprise to see a rebound provided the fairly strong healing in home mortgage rates (now at their least expensive day-to-day levels in more than 2 weeks).
Purchase demand, on the other hand, “still ran at a more powerful speed than last year’s speed,” according to Kan. He also noted that the typical purchase loan size reached a brand-new study high of $473,600, as “debtors with smaller loan sizes were less active offered the higher rate environment and its negative influence on their buying power.”
Application composition shifted lower across a lot of government-backed segments. ARM share decreased to 9.4% from 9.6% the previous week, while FHA share slipped to 17.2% from 17.9%. VA share reduced to 13.2% from 14.4%, while USDA share edged as much as 0.5% from 0.4%.
Mortgage Rate Summary:
- 30yr Repaired: 6.65% (from 6.56%)|Points: 0.65 (from 0.60)
- 15yr Fixed: 5.97% (from 5.93%)|Points: 0.84 (from 0.73)
- Jumbo 30yr: 6.68% (from 6.58%)|Points: 0.42 (from 0.38)
- FHA: 6.31% (from 6.24%)|Points: 0.79 (from 0.67)
- 5/1 ARM: 5.81% (from 5.76%)|Points: 0.82 (from 0.85)