Purchase mortgage applications sank below year-ago levels in the last days of March and early April amid what the Mortgage Bankers Association (MBA) called “higher mortgage rates and continued economic uncertainty” in its latest weekly report of mortgage demand.
The MBA’s Market Composite Index, a measure of mortgage loan application volume, declined 0.8% over the week ending April 3 on a seasonally adjusted basis. The refinance component index dropped 3% from the previous week and 4% from a year ago.
Joel Kan, deputy chief economist at the MBA, noted in a statement accompanying the figures that “many potential refinance borrowers have been frozen out” due to a roughly 50-basis-point jump in mortgage rates over the past month amid fallout from the Iran war.
The refinance share of overall application activity decreased to 44.3% from 45.3% the previous week, while the adjustable-rate mortgage (ARM) share of application activity rose to 8.6% of total applications.
“The pace of refinance applications was at its lowest level since December 2025,” said Kan, who also flagged that purchase mortgage demand saw an annual decline for the first time since January 2025.
Purchase applications had ended February with momentum before the Middle East conflict triggered a spike in yields on 10-year U.S. Treasury bonds alongside inflation concerns linked to global energy and trade disruptions.
Freddie Mac says the average mortgage rate for typical 30-year loans was 6.46% over the MBA’s survey period, its fifth straight week of increases, while MBA data shows average 30-year mortgage rates of 6.51%, a decline from 6.57% the previous week.
While the total share of applications for mortgages insured by the Federal Housing Administration dipped slightly to 19.3% last week, applications for FHA purchase mortgages rose 5%, said Kan, boosted by lower rates on the government loans.
Average mortgage rates for 30-year fixed-rate loans backed by the FHA declined to 6.22% from 6.25% the previous week. The share of total applications for mortgages backed by the Department of Veterans Affairs was unchanged over the week at 16.1%.
The median payment for a new purchase mortgage originated in February was $2,061, down slightly from $2,070 in January and $2,205 one year ago, the MBA reported previously.
