Mortgage applications surged by more than 33 percent in the week ending Jan. 10 with interest rates climbing across most loan types, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey.
The results were adjusted to account for the New Year’s holiday. On an unadjusted basis, the Market Composite Index, which measures application volume, increased by 52 percent from the previous week.
MBA Vice President and Deputy Chief Economist Joel Kan attributed the significant increase, in part, to investors’ concerns over uncertainty about inflation. He noted an ongoing trend in the bond market in his commentary published by MBA.
“Bond yields in the U.S. and abroad continued to move higher in response to concerns over a sticky inflation outlook and still too-high budget deficits, which pushed mortgage rates higher for the fifth consecutive week,” Kan explained. “The 30-year fixed rate is now at 7.09 percent – its highest level since May 2024. This time of the year is a particularly volatile time for application volumes, so it can be more helpful to focus on the level rather than the percent change. Purchase applications were 2 percent lower, and refinances were 22 percent higher compared to a year ago. Total applications were up by 33.3 percent, the highest level in a month, as both purchase and refinance applications saw large percentage increases over the week.”
Conforming 30-year fixed-rate mortgages rose to 7.09 percent, jumbo loans increased to 7.05 percent, and FHA-backed loans reached 6.76 percent, according to the survey results. Fifteen-year fixed-rate mortgages decreased slightly to 6.43 percent. Rates for 5/1 adjustable-rate mortgages increased to 6.18 percent. Points varied slightly across loan types, influencing effective rates.
Refinance applications jumped 44 percent from the prior week and were 22 percent higher than the same period last year. Purchase applications increased 27 percent on a seasonally adjusted basis and rose 48 percent unadjusted from the previous week. However, purchase applications remained 2 percent lower than the same week in 2024.
The refinance share of applications rose to 42.7 percent from 40.8 percent the previous week, while the adjustable-rate mortgage share edged up to 5 percent. Government-backed mortgage activity showed mixed changes: FHA loans held steady at 16.9 percent, while VA loans dropped to 15.7 percent from 16.2 percent, and USDA loans declined slightly to 0.5 percent from 0.6 percent.