Mortgage loan application volume in the U.S. decreased 5% on a seasonally adjusted basis for the week ending Dec. 19, 2025, according to the latest data from the Mortgage Bankers Association (MBA), snapping recent momentum despite a decrease in mortgage rates.
The Market Composite Index, the MBA’s primary measure of mortgage loan application volume, fell 5% seasonally adjusted from the week prior. On an unadjusted basis, the index decreased 6% compared with the previous week.
While immediate week-over-week numbers showed a decline across both purchase and refinance indices, the year-over-year comparison paints a picture of a recovering market compared to late 2024.
The Refinance Index decreased 6% from the previous week but stands 110% higher than the same week one year ago, showing the rise in refinance activity. Similarly, the seasonally adjusted Purchase Index was 16% higher than the same week in 2024.
“Overall mortgage application volume fell last week, despite the slight decline in mortgage rates,” said Mike Fratantoni, MBA’s senior vice president and chief economist, in a press release accompanying the report.
He provided a forward-looking assessment for the industry as it heads into 2026. “MBA expects the trends of a softening job market, sticky inflation, elevated home inventories, and steady mortgage rates will persist into the new year,” Fratantoni stated.
Despite the weekly slump, Fratantoni emphasized the year-over-year growth in purchase activity. “Purchase application volume last week was 16% higher than a year earlier. We are forecasting continued, modest growth in terms of home sales in 2026,” he added.
The refinance share of mortgage activity saw a slight uptick, increasing to 59.1% of total applications from 59% the previous week. The adjustable-rate mortgage (ARM) share of activity also rose, reaching 8.1% of total applications.
In terms of government-backed loans, the Federal Housing Administration share of total applications increased to 20.8% from 19.5% the week prior. Meanwhile, the Department of Veteran Affairs share decreased to 15.3% from 16.6%, while the U.S. Department of Agriculture share remained unchanged at 0.4%.
Interest rates were mixed across different loan products. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) decreased to 6.31%. Points for these loans decreased five basis points to 0.57 from 0.62 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
In contrast, the average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $806,500) increased to 6.52% from 6.44%.
The MBA announced that its offices will be closed beginning Dec. 25, 2025. Consequently, results for the weeks ending Dec. 26 and Jan. 2 will be released together on Wednesday, Jan. 7.
