Buyers stepped in despite the 30-year rate climbing to its highest level since August 2025
Total mortgage application volume climbed 1.9% in the week ending July 17, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey, as a rebound in purchase activity more than offset a retreat in refinancing.
The result reflects a buyer pool that has not fully stood down, even as borrowing costs hit their highest level since last summer.
The seasonally adjusted Purchase Index rose 6% from the prior week. On an unadjusted basis, purchase volume was 0.2% above the same week one year ago — essentially flat annually, but directionally encouraging for originators who watched buyers retreat as mortgage rates climbed to an 11-month high just the week before.
The Refinance Index fell 2% for the week, though it remains 7% above year-ago levels.
Rates reach another high
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($832,750 or less) rose to 6.69% from 6.65%, the highest reading since August 2025.
"Mortgage rates reached another high point last week, with the 30-year conforming rate now at 6.69%, its highest level since last August," said Mike Fratantoni, MBA's SVP and chief economist.
"However, purchase volume increased modestly for the week. Growing home inventory in many markets is supporting more purchase activity."
Fratantoni flagged the inflation picture as the critical wildcard. June consumer price data showed improvement, but spiking oil prices raise doubts about whether that relief will carry through to July, keeping mortgage rates elevated as a result.
That dynamic has shaped a housing market kept subdued through 2026 by persistently elevated borrowing costs, with brokers operating in a mid-6% rate environment that shows little sign of easing.
The 30-year jumbo rate moved in the opposite direction, dropping to 6.44% from 6.62%. The 15-year fixed rate edged down one basis point to 6.04%.
The 5/1 adjustable-rate mortgage (ARM) rate climbed to 5.97% from 5.75%, with the ARM share of total applications rising to 7.7% from 7.1%, a sign that some borrowers are beginning to weigh adjustable products as fixed-rate costs press higher.
Odeta Kushi of First American says demographic demand and life events continue to support the housing market, even as higher mortgage rates and a slower labor market influence buyer confidence.https://t.co/x2Vh3pc5If
— Mortgage Professional America Magazine (@MPAMagazineUS) July 16, 2026
Inventory provides a partial offset
The refinance share of total applications fell to 41.2% from 43.2%, reflecting a narrower pool of borrowers for whom a new loan makes financial sense at current rates.
Federal Housing Administration (FHA) loans accounted for 17.0% of applications, down from 17.7%, while Department of Veterans Affairs (VA) loans slipped to 13.2% from 13.6%. U.S. Department of Agriculture (USDA) applications held flat at 0.5%.
Average total mortgage loan size rose to $383,700 from $379,500, according to MBA data. The average purchase loan edged up to $443,800, while the average refinance loan reached $297,900.
With home sales on track for a second-half recovery as inventory builds across many markets, the pace of that recovery will depend heavily on whether purchase momentum can hold against a rate environment that, barring a sustained pullback in oil prices or a shift in Federal Reserve posture, has room to move higher before it moves lower.
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