Mortgage application volume jumped 9.2% during the week ended September 5, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
The results include an adjustment for the Labor Day holiday. On an unadjusted basis, mortgage applications decreased 3% compared with the previous week.
Driving the increase was a drop in mortgage rates. The average closing rate for a 30-year fixed-rate mortgage with conforming loan balance decreased to 6.49%, down from 6.64% the previous week.
Applications for refinances increased 12% compared with the previous week and were up 34% percent higher than the same week one year ago.
Applications for purchases increased 7% compared with the previous week and were up 23% compared with the same week one year ago.
“Mortgage rates declined for the second consecutive week as Treasury yields moved lower on data indicating that the labor market is weakening,” says Joel Kan, vice president and deputy chief economist for the MBA, in a statement. “The 30-year fixed rate decreased to 6.49 percent, down 20 basis points over the past two weeks to the lowest since October 2024.”
“The downward rate movement spurred the strongest week of borrower demand since 2022, with both purchase and refinance applications moving higher,” Kan says. “Purchase applications increased to the highest level since July and continued to run more than 20 percent ahead of last year’s pace. There was also a pickup in ARM applications, both in terms of level and share, as ARM rates were considerably lower than fixed rate loans, which typically benefits homebuyers.”
“The holiday-adjusted refinance index had its strongest week in a year and the average loan size for refinances also increased significantly, since borrowers with large loans are more sensitive to bigger rate moves,” he adds. “Refinance applications accounted for almost 49 percent of all applications last week.”
The refinance share of mortgage activity increased to 48.8% of total applications, up from 46.9% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 9.2% of total applications.
Photo: Herve Margot