WASHINGTON — Mortgage applications fell for the second straight week as mortgage rates climbed to their highest levels since late last summer, according to data released by the Mortgage Bankers Association.
The Mortgage Bankers Association said its Market Composite Index, which measures mortgage application volume, declined 8.5% on a seasonally adjusted basis for the week ending May 22. That followed a 2.3% decline the previous week.
The association said weakening affordability pressures weighed on home purchase activity, while higher borrowing costs sharply reduced refinancing demand.
The seasonally adjusted purchase index fell 0.4% from the prior week, while the refinance index dropped 18%.
Despite the declines, both purchase and refinance activity remained above year-earlier levels, according to MBA economist Joel Kan.
The MBA said purchase applications were 5% higher than the same week a year earlier, though that marked a slowdown from the prior week’s 8% annual increase. Refinance applications were up 19% from a year ago.
30 Basis Point Jump
“The 30-year fixed rate has increased 30 basis points over the past five weeks to its highest level since August 2025,” Kan said in the report. “With the rate now at 6.65%, many borrowers understandably backed away from refinancing last week.”
The average contract interest rate for 30-year fixed-rate conforming mortgages increased from 6.56% the previous week and 6.46% two weeks earlier, MBA data showed.
Higher rates also reduced the refinance share of total mortgage applications to 37.5%, the lowest level since last June, down from 42% the prior week.
Meanwhile, adjustable-rate mortgages continued to represent an elevated share of activity at 9.4% of all applications, compared with 9.6% the previous week.
The MBA report also showed declines in government-backed loan activity.
FHFA Loan Apps Decline
Applications for mortgages insured by the Federal Housing Administration fell to 17.2% of total applications from 17.9% the prior week, while applications backed by the Department of Veterans Affairs declined to 13.2% from 14.4%.
The average contract interest rate for 30-year fixed-rate FHA-backed mortgages rose to 6.31%, up from 6.24% the previous week and 6.16% two weeks earlier, according to the MBA.
Kan said higher rates resulted in “large declines in applications across loan types,” particularly affecting borrowers seeking smaller loan amounts as affordability pressures intensified.
