Mortgage application activity was on the rise last week while mortgage credit availability was in decline last month, according to two new data reports from the Mortgage Bankers Association (MBA).
The Market Composite Index, the MBA’s measure of mortgage loan application volume, increased 1.7% on a seasonally adjusted basis for the week ending May 8 compared to one week earlier. On an unadjusted basis, the index increased 2%.
Both the seasonally adjusted and unadjusted Purchase Index increased 4% from one week earlier, while the latter was 7% higher than the same week one year ago. The Refinance Index dipped by 1% from the previous week and was 28% higher than the same week one year ago, while the refinance share of mortgage activity decreased to 40.8% of total applications from 42.0% in the previous week.
Among the federal programs, the FHA share of total applications inched up to 17.9% from 17.7% the week prior while the VA and USDA shares of total applications remained unchanged at 14.9% and 0.5%, respectively.
Joel Kan, MBA’s vice president and deputy chief economist, observed, “Purchase applications were higher over the week and 7% ahead of last year’s pace, with all loan types showing increases in purchase activity, as potential homebuyers shrugged off the current economic and mortgage rate uncertainties and returned to the market. Refinance applications declined slightly, led by conventional and VA refinancings, and accounted for a little more than 40% of applications last week, the lowest share since July 2025.”
Separately, the MBA’s Mortgage Credit Availability Index (MCAI) dropped by 0.4% in April to a reading of 107.9; the index was benchmarked to 100 in March 2012. The Conventional MCAI decreased 0.6% while the Government MCAI remained unchanged. Of the component indices of the Conventional MCAI, the Jumbo MCAI stumbled by 1.0% and the Conforming MCAI rose by 0.5%.
“After three months of increases, mortgage credit availably decreased slightly in April as lenders tightened up on conventional loan programs with high LTV and low credit requirements,” said Kan. “Some of this tightening also impacted super jumbo loan programs, which resulted in a decline in the conforming jumbo index. Offsetting some of the April decline was a small increase in non-QM programs, a segment of the market that continues to grow. Overall, credit availability remains tight by historical standards, but mortgage originations activity has recently been impacted by mortgage rates, housing inventory, and the economic environment.”
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