Mortgage lenders in the United States saw a dramatic increase in volume in mid-January, with numbers being driven by refinance businesses.
The Mortgage Bankers Association's (MBA) latest Weekly Mortgage Applications Survey showed overall applications rose by 14.1% on a seasonally adjusted basis week-over-week and 17% unadjusted on the week ending 16 January.
This was led by refinance activity, which climbed 20% week-over-week and 183% from the same time last year.
On the flip side, purchase applications only increased 5% on a seasonally adjusted basis and 18% year-over-year.
This comes as the average contract for a 30-year fixed-rate mortgage for loans at or below US$832,750 decreased to 6.16% from 6.18%, with points falling to 0.54 from 0.56, including origination fee, for loans with a 20% downpayment, marking the lowest rate since September 2024.
MBA vice president Joel Kan said this was driven by a decline in mortgage rates.
“These lower rates prompted greater refinance activity from conventional and VA refinance borrowers, with increases of 29% and 26%, respectively,” he said.
“Refinance applications accounted for more than 60% of applications, and the average loan size also moved higher.”
Refinances accounted for 61.9% of all applications, up from 60.2% in the previous week, while the adjustable-rate mortgage share ticked up 7.1%.
This follows applications falling 9.7% over a holiday-affected two-week period, even as the refinance share rose above 56%.
Another MBA release before the latest survey showed a 28.5% jump in applications when the 30-year fixed-rate mortgage declined to 6.18%, with refinance volume up 40% to its strongest pace since October 2025.
Rates initially dropped after President Donald Trump said he would make mortgage giants Fannie Mae and Freddie Max buy $200 million of mortgage-backed bonds.
Interest rates moved much higher to start this week, as bond markets sold off following Trump’s threats of new tariffs and escalating tensions over Greenland.
