Mortgage application activity was lethargic during the week ending May 22, fueled primarily by a pullback in refinancing, according to data from the Mortgage Bankers Association (MBA).
The Market Composite Index, the MBA’s measure of mortgage loan application volume, decreased 8.5% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index dropped by 9%.
The seasonally adjusted Purchase Index dipped by a slight 0.4% from one week earlier while the unadjusted index took a more substantial 2% tumble – the latter was also 5% higher than the same week one year ago.
The Refinance Index plummeted by 18% from the previous week, although it was also 19% percent higher than the same week one year ago. The refinance share of mortgage activity fell to 37.5% of total applications from 41.9% in the previous week.
Among the federal programs, the FHA share of total applications decreased to 17.2% from 17.9% the week prior while the VA share of total applications decreased to 13.2% from 14.4% and the USDA share of total applications inched up to 0.5% from 0.4%.
Joel Kan, MBA’s vice president and deputy chief economist, observed, “There were large declines in applications across loan types – conventional refinances were down 14%, along with an 18% decrease for FHA applications and a 34% decrease for VA applications. Overall, refinance applications accounted for 38% of applications, the lowest share since June 2025.”
Kan added, “Purchase applications were slightly lower across all loan types but still ran at a stronger pace than last year’s pace. The average loan size for a purchase application reached another survey high at $473,600, as borrowers with smaller loan sizes were less active given the higher rate environment and its negative impact on their purchasing power.”
0 Comments