Homes in Palm Beach Gardens, Florida, USA, on Sunday, January 11, 2026.
Zak Bennett | Bloomberg | Getty Images
After a sharp decline, mortgage rates rose last week for the first time in a month. This resulted in an 8.5% decline in overall mortgage demand compared to the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $832,750 or less increased from 6.16% to 6.24%, with points for loans with a 20% down payment increasing from 0.54 to 0.55, including the origination fee. That was the highest rate in three weeks.
As a result, applications to refinance a home loan fell 16% this week, but were still 156% higher than the same week a year ago. That’s because interest rates were 78 basis points higher a year ago.
“FHA refinancing activity bucked the overall trend and increased as FHA interest rates remained nearly 20 basis points below equivalent rates,” Joel Kan, MBA vice president and deputy chief economist, said in a press release. “With interest rates hovering in the 6 percent range, the refinance market will likely remain sensitive to weekly interest rate movements.”
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The number of mortgage applications to purchase a home was essentially flat, down 0.4% from a week earlier and 18% higher than a year ago. Homebuyers still face a very expensive market. The selection is larger than last year, but most of it is in the upper price segment.
“The average loan size remained at the highest level since September 2025,” Kan added.
Mortgage rates fell slightly earlier this week, according to a separate survey from Mortgage News Daily. The next chance for a significant move in either direction comes on Wednesday with the final meeting of the Federal Open Market Committee. Most expect the federal funds rate to remain unchanged, but markets will be ready to react to comments from Federal Reserve Chair Jerome Powell.