Mortgage Application Activity Drops by 1.2%

Mortgage application activity decelerated for the week ending Aug. 29, according to data from the Mortgage Bankers Association (MBA).

The Market Composite Index, the MBA’s measure of mortgage loan application volume, decreased 1.2% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index was down by 3% compared with the previous week.

The seasonally adjusted Purchase Index decreased 3% from one week earlier while the unadjusted index fell 6% – the latter was also 17% higher than the same week one year ago.

The Refinance Index inched up by 1% from the previous week and was 20% higher than the same week one year ago. The refinance share of mortgage activity increased to 46.9% of total applications from 45.3% the previous week.

Among the federal programs, the FHA share of total applications increased to 19.9% from 19.1% the week prior while the VA share of total applications increased to 13.8% from 13.3% the week prior and the USDA share of total applications remained unchanged at 0.5%.

Joel Kan, MBA’s vice president and deputy chief economist, observed, “Refinance applications saw a small increase from the previous week, driven by FHA and VA refinance applications, but conventional refinances declined. The FHA rate is averaging about 30 basis points lower than the conventional rate in 2025, which has made those loans relatively more appealing to eligible borrowers. Purchase activity pulled back, after a four-week run of increases, as slower homebuying activity led to declines in applications across the various loan types.”