Mortgage rates ticking down slightly didn’t move the needle on application activity this week, but the pace still remains ahead of last year at this time, according to this week’s update from the Mortgage Bankers Association (MBA).
The latest Market Composite Index from the MBA—its measure of mortgage loan activity volume and includes purchases and refinances—shows application activity decreasing 2.5% on a seasonally adjusted basis from last week’s 8.5% decrease, for the week ending May 29. On an unadjusted basis, the Index decreased 13% compared with the previous week. This week’s results include an adjustment for the Memorial Day holiday.
“The prospect of easing energy prices given the evolving situation in the Middle East brought mortgage rates slightly lower last week. The retreat in rates, however, did not lead to an increase in mortgage applications,” said Joel Kan, CMB, MBA’s vice president and deputy chief economist. “Purchase applications remained ahead of 2025’s pace but were at its slowest weekly pace since April, and refinance activity was at its weakest since last June.”
Added Kan, “The 30-year fixed rate decreased to 6.57 percent while the 5-year ARM rate inched up slightly, reflecting a flattening yield curve, as short-term rates are at risk of increasing while longer-term rates have dropped. Additionally, the ARM index decreased 12 percent over the week, and the ARM share dropped to 8.5 percent.”
MBA’s Refinance Index decreased 2% from the previous week and was 20% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 3% from one week earlier. The unadjusted Purchase Index decreased 14% compared with the previous week and was 7% higher than the same week one year ago, according to the report.
The refinance share of mortgage activity increased to 38.0%% of total applications from 37.5% the previous week, MBA reported. The adjustable-rate mortgage (ARM) share of activity decreased to 8.5% of total applications.
Government-backed loans were mixed this week: The FHA share of total applications decreased to 17.0% from 17.2% the week prior. The VA share of total applications increased to 14.4% from 13.2% the week prior, and the USDA share of total applications remained unchanged at 0.5% the week prior.
To view the full report, click here.
