Mortgage Application Activity Slows for Third Straight Week

Mortgage applications activity was down for the third straight week, according to data from the from the Mortgage Bankers Association (MBA) covering the week ending May 30; the data included an adjustment for the Memorial Day holiday.

The Market Composite Index, the MBA’s measure of mortgage loan application volume, decreased 3.9% on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the index fell by 15%.

The seasonally adjusted Purchase Index decreased 4% from one week earlier while the unadjusted index dropped by 15% – the latter was also 18% higher than the same week one year ago. The Refinance Index decreased 4% from the previous week and was 42% higher than the same week one year ago and the refinance share of mortgage activity increased to 35.2% of total applications from 34.6% the previous week.

Among the federal programs, the FHA share of total applications increased to 18.7% from 17.9% the week prior while the VA share of total applications increased to 12.6% from 12.3% and the USDA share of total applications remained unchanged at 0.5%.

Joel Kan, MBA’s vice president and deputy chief economist, observed, “Mortgage applications decreased over the week, but continue to exhibit annual gains, with purchase applications running 18% ahead of last year’s place. Government purchase applications were little changed over the week driven by a slight increase in FHA purchase applications. Refinance activity fell across both conventional and government segment and the overall average refinance loan size was the smallest since July 2024, as potential borrowers hold out for larger rate drops.”