Mortgage Applications Surge On Rate Drop, Refinance Activity Reaches April High

Mortgage applications jumped 10.9% last week as mortgage rates retreated, driving the strongest refinance activity in nearly four months, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Aug. 8, 2025.

The Market Composite Index, a measure of aggregate mortgage loan application volume, increased 10.9% on a seasonally adjusted basis from the prior week (10% unadjusted). That’s a sharp acceleration from the 3.1% weekly gain reported a week earlier.

The Refinance Index was up 23% week over week — the largest single-week gain since April — and was 8% higher than the same week in 2024. Last week’s increase of 5% already marked a turnaround from three weeks of declines.

Meanwhile, the Purchase Index was up slightly — 1% — seasonally adjusted (1% unadjusted) from the previous week, but was still 17% higher than the same week a year ago. That follows a 2% adjusted gain the week prior.

“The 30-year fixed mortgage rate declined to 6.67% last week, which spurred the strongest week for refinance activity since April,” said MBA Vice President and Deputy Chief Economist Joel Kan. “Borrowers responded favorably, as refinance applications increased 23%, driven mostly by conventional and VA applications.”

Kan noted the refinance share of applications jumped to 46.5%, the highest level since early spring. He also highlighted that the average loan size for refinances rose significantly to $366,400, underscoring that borrowers with larger loan balances remain most sensitive to rate changes.

Adjustable-rate mortgages (ARMs) also saw a spike in demand, with applications up 25% to their highest level since 2022. The ARM share of total applications rose to nearly 10%, reflecting their comparative rate advantage over fixed loans. 

While down from the previous week, 30-year rates weren't yet attractive enough for would-be homebuyers. "Lower rates were not enough to entice more homebuyers back into the market," Kan noted, "as purchase applications were only up around 1% over the week, although still stronger than last year’s pace.”

Loan Type Share Of Total Applications:

• Refinance share: 46.5% (up from 41.5%)
   
• ARM share: 9.6% (up from 8.5%)
   
• FHA share: 18.4% (down slightly from 18.5%)
   
• VA share: 14.2% (up from 13.3%)
   
• USDA share: 0.5% (unchanged)

Average Contract Interest Rates:

• 30-year fixed (conforming ≤ $806,500): 6.67% (down from 6.77%), points up to 0.64 from 0.59
   
• 30-year fixed (jumbo > $806,500): 6.70% (up from 6.65%), points down to 0.56 from 0.59
   
• 30-year fixed (FHA): 6.40% (down from 6.47%), points down to 0.77 from 0.81
   
• 15-year fixed: 5.93% (down from 6.03%), points down to 0.63 from 0.66
   
• 5/1 ARM: 5.80% (down from 6.06%), points up to 0.67 from 0.49

The MBA’s Weekly Mortgage Applications Survey has been conducted since 1990 and covers closed-end residential mortgage applications originated through retail and consumer direct channels.