WASHINGTON — Mortgage activity declined last week despite a slight dip in interest rates, as economic uncertainty tied to geopolitical tensions continued to weigh on borrowers, according to the Mortgage Bankers Association.
Total mortgage application volume fell 0.8% on a seasonally adjusted basis compared with the previous week, the Mortgage Bankers Association (MBA) said.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $832,750 or less decreased to 6.51% from 6.57%. Points, including the origination fee, declined to 0.61 from 0.65 for loans with a 20% down payment, according to the MBA.
Purchase activity showed mixed signals:
- Applications to buy a home rose 1% week over week
- Purchase volume was 7% lower than the same week a year earlier
- The annual decline marked the first since January 2025
Some are ‘Faring Better’
“Certain loan types and geographic segments are faring better than others because of lower rates on ARM and FHA loans as well as growing housing inventory in some local markets,” said Joel Kan, an MBA economist, in a statement. “Applications for FHA purchase applications were up 5% over the week, supported by the FHA mortgage rate being about 30 basis points lower than the conventional mortgage rate.”
Refinancing activity weakened further, the MBA said:
- Refinance applications fell 3% from the prior week
- Refinance volume was 4% lower than a year earlier
- The year-over-year decline was also the first since January 2025
“Many potential refinance borrowers have been frozen out by the sharp increase over the past month,” Kan said. “The pace of refinance applications was at its lowest level since December 2025.”
Rates Could Move Lower
The MBA said mortgage rates remained largely flat at the start of the current week but could move lower following a decline in the yield on the U.S. 10-year Treasury after President Donald Trump announced a two-week ceasefire related to the Iran conflict.
