Mortgage applications fell 1.2% from the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending February 21, 2025. The Market Composite Index, which measures total loan application volume, was down 1.2% on a seasonally adjusted basis and 4% unadjusted.
The Refinance Index declined 4% from the prior week, but remained 45% higher than the same week last year. The seasonally adjusted Purchase Index was unchanged, while the unadjusted Purchase Index fell 5%, but was still 3% higher than a year ago.
“Treasury yields moved lower on softer consumer spending data as consumers are feeling somewhat less upbeat about the economy and job market. This pushed mortgage rates lower, with the 30-year fixed rate decreasing to 6.88 percent, the lowest rate since mid-December,” said MBA Vice President and Deputy Chief Economist Joel Kan.
Purchase applications stayed flat from a week ago, but were up 3% YoY, while refinance applications saw a small decline.
“Although overall refinance application activity remained fairly weak, FHA refinance applications saw an 8 percent increase over the week. Compared to last year, overall refinance applications were up 45 percent," Kan continued.
The refinance share of mortgage activity edged up to 38.9% from 38.7% the previous week. The FHA share of total applications increased to 17.4%, while VA and USDA loan shares declined.
Interest rates decreased across most loan types. The average contract rate for 30-year fixed-rate mortgages fell to 6.88% from 6.93% for conforming loans, and fell to 7% from 7.03% for jumbo loans. FHA-backed 30-year rates dropped to 6.57% from 6.7%.
The15-year fixed also saw declines, falling to 6.25% from 6.31%. Plus, 5/1 adjustable-rate mortgages (ARMs) fell to 6.05% from 6.08%.
“Increasing for-sale inventory in some markets has provided prospective buyers more options as we approach the spring homebuying season,” Kan added.
