A “For Sale” sign is in a house in Miami, Florida, USA, April 16, 2025.
Bello Marco | Reuters
After they have been moved to a narrow area for several weeks, the mortgage interest rates rose significantly higher last week. This led to a decline in mortgage applications by 5.1% compared to the previous week, according to the seasonally adjusted index of the Mortgage Bankers Association.
The average contract interest rate for 30-year fixed mortgages with compliant loan credit of $ 806,500 or less rose from 6.86%to 6.92%, whereby the points rose to 0.69 out of 0.68, including the originating fee for loans with a down payment of 20%. This rate was only 9 in the same week a year ago.
“The mortgage interest rates have risen at the highest level since February last week, with investors being concerned about increasing inflation and the effects of increasing deficits and debts,” said Mike Fratantoni, Senior Vice President and chief economist at the MBA.
Applications for a mortgage to buy a house that had increased for a few weeks decreased by 5% for the week and was 13% higher than the same week ago a year ago. Home buyers see a lot more lists on the market than a few months ago, but higher interest rates as well as the increasing concern about the state of business and inflation have cooled the normally busy spring season.
Applications for refinancing a housing loan also fell 5% for the week and was 27% higher than the same week ago a year ago. Since the tariffs were almost the same as a year ago and two years ago, there are fewer and fewer borrowers who can benefit from refinancing.