United States mortgage applications fell last week, as mortgage rates rose following the Federal Reserve’s interest rate cut.
Seasonally adjusted application volumes were down 3.8% from the previous week, the Mortgage Bankers Association (MBA) found. The 30-year fixed mortgage rate grew to 6.38% from 6.33%.
“Mortgage rates inched up last week following the FOMC [Federal Open Market Committee] meeting, as investors interpreted the comments to signal that we are near the end of this rate-cutting cycle. As a result, mortgage applications declined slightly,” said MBA chief economist Mike Fratantoni.
“Purchase application volume typically drops off quickly at the end of the year, and this shifts the mix of the business, with the refinance share reaching 59% last week, the highest level since September. However, refinance activity has remained mostly the same for the past month as rates continue to hold at around the same narrow range.”
The Fed said last week that it would lower rates by 0.25% to a range of 3.5-3.75%, the third cut this year. Mortgage rates also increased after 2025's previous two rate cuts.
Home loan refinancing applications dropped 4% last week, the MBA found, though they have climbed by 86% across the past 12 months. Refinancing represented 59.0% of mortgage applications, up from 58.2% the prior week.
Applications for mortgages to buy a home also declined by 3% for the week.
The daily 30-year fixed mortgage rate dipped to 6.27% on Wednesday (Thursday AEDT), according to Mortgage News Daily’s index, after the U.S.’ November jobs report saw unemployment reach a four-year high.
