Mortgage rates fall to 6.09% as applications rise 0.4%

"Mortgage rates followed Treasury yields lower last week, with the 30-year fixed rate declining to 6.09% its lowest level since September 2022. The decrease in rates was enough to drive a 5% increase in conventional refinance applications and a 26% increase in VA refinances, said Joel Kan, MBA's vice president and deputy chief economist."

"Purchase applications were down over the week but were 12% higher than a year ago, as the combination of lower rates and improving affordability conditions continue to support stronger demand than last year. The ARM share stayed above 8%, as ARM rates remained more than 80 basis points below conforming fixed rates."

"The refinance share of mortgage activity increased to 58.6% of total applications, up from 57.4% the previous week. The refinance index, meanwhile, increased 4% from the previous week and was 150% higher than the same week one year ago."

Mortgage rates fell last week, with the 30-year fixed rate reaching 6.09%, its lowest point since September 2022. This decline triggered significant increases in refinance activity, including a 5% rise in conventional refinances and a 26% surge in VA refinances. Purchase applications decreased week-over-week but remained 12% higher than a year ago, reflecting improved affordability conditions and sustained demand. The refinance share of total mortgage activity increased to 58.6%, up from 57.4% the previous week. ARM rates remained more than 80 basis points below conforming fixed rates, incentivizing payment-sensitive borrowers and those seeking larger loans. VA loan share increased to 18.7%, while FHA share decreased to 16.1%. Rates across various mortgage products declined, including 15-year fixed mortgages at 5.48% and 5/1 ARMs at 5.23%.

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