Mortgage demand slides 8.5%, driven by 18% drop in refi applications

Mortgage applications decreased 8.5% from one week earlier, according to data from the Mortgage Bankers Association (MBA)’s weekly mortgage applications survey for the week ending May 22.

On an unadjusted basis, the index decreased 9% compared with the previous week.

The refinance index slipped again, decreasing 18% from the previous week. It was 19% higher than the same week one year ago.

The seasonally adjusted purchase index decreased 0.4% from one week earlier. The unadjusted purchase index decreased 2% compared with the previous week and was 5% higher than the same week one year ago.

“The 30-year fixed rate has increased 30 basis points over the past five weeks to its highest level since August 2025. With the rate now at 6.65%, many borrowers understandably backed away from refinancing last week,” said Joel Kan, MBA’s vice president and deputy chief economist. “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.

“Purchase applications were slightly lower across all loan types but still ran at a stronger pace than last year’s pace,” Kan added. “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.”

The refinance share of mortgage activity decreased to 37.5% of total applications, down from 41.9% the previous week. The adjustable-rate mortgage share of activity decreased to 9.4% of total applications.

By product channel, the Federal Housing Administration (FHA) share of total applications decreased to 17.2%, compared to 17.9% the week prior. The U.S. Department of Veterans Affairs (VA) share decreased from 14.4% to 13.2% during the week. And the U.S. Department of Agriculture (USDA) share increased from 0.4% to 0.5%.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances increased to 6.65%, up from 6.56%, and rates for jumbo mortgages increased from 6.58% to 6.68%.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.31%, up from 6.24%, and rates for 15-year fixed-rate mortgages increased to 5.97%, up from 5.93%. The average rate rate for 5/1 ARMs increased rose 5 basis points to 5.81%.

Xactus Mortgage Intent Index

Xactus‘s Mortgage Intent Index — which analyzes aggregated, anonymized credit-pull activity across the Xactus Intelligent Verification Platform — declined to a reading of 127.6, down from last week’s 132.5.

“Mortgage intent continues to soften amid ongoing economic uncertainty and elevated mortgage interest rates,” said Thomas Lloyd, Xactus’ chief strategy officer. “The Xactus Mortgage Intent Index declined approximately 3.7% from the prior week and was roughly 4.1% below the same week last year.”

Lloyd remarked that the latest reading marks the lowest level for the index this year, “coinciding with mortgage rates reaching some of their highest levels of the year, moving above 6.5%.”