Mortgage Applications Hit Two-Month Low Amid Market Uncertainty

Mortgage application activity fell to its lowest point since May, as both purchase and refinance volumes dipped last week, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 25, 2025. That follows a slight increase overall last week. 

The MBA’s Market Composite Index — a measure of total mortgage application volume — dropped 3.8% on a seasonally adjusted basis from the prior week, and 4% unadjusted. Purchase applications slid 6% seasonally adjusted, while refinance applications slipped 1%.

“Mortgage applications fell to their lowest level since May, with both purchase and refinance activity declining over the week,” said MBA’s Vice President and Deputy Chief Economist Joel Kan. 

“There is still plenty of uncertainty surrounding the economy and job market, which is weighing on prospective homebuyers’ decisions,” he added. 

Still, mortgage applications remain higher than 2024 levels. According to the MBA’s latest data, refinance activity was 30% higher than the same week one year ago, while purchase application activity was 17% higher, both significantly ahead of last year’s sluggish summer market.

Kan noted that the 30-year fixed mortgage rate barely moved, averaging 6.83%, but remains high enough to keep refinancing interest low — pushing the refi index down for the third straight week. 

“Purchase applications decreased by almost 6%, as applications for conventional, FHA, and VA purchase loans fell, despite slowing home-price growth and increasing levels of for-sale inventory in many regions,” he commented.

Refi Share Climbs, ARMs Tick Up

The refinance share of total mortgage activity rose to 40.7% from 39.6% the prior week, while adjustable-rate mortgages (ARMs) accounted for 8.3% of applications, up slightly. FHA loans made up 18.8% of all applications (up from 18.7%), VA loans fell to 12.2% from 12.6%, and USDA loans held steady from the prior week at 0.6%.

Rates were mixed across loan types:

• 30-year fixed (conforming ≤$806,500) was 6.83%, down a sliver from 6.84%;
• 30-year fixed (jumbo >$806,500) was 6.74% down from 6.75%;
• 30-year FHA was 6.56%, up from 6.52%;
• 15-year fixed was 6.12%, down from 6.14%; and
• 5/1 ARM was 6.22%, up from 6.01%.

Despite modest declines in some fixed rates, the effective rates on FHA and ARM loans rose last week, adding to affordability challenges for certain borrowers.

The MBA’s weekly survey, which covers U.S. closed-end residential mortgage applications originated through retail and consumer direct channels, has been conducted weekly for the past 35 years since 1990.