Mortgage Application Payments Down in September

Homebuyer affordability improved last month as the national median payment applied for by purchase applicants dropped by 0.8% from $2,057 in August to $2,041 in September, according to the Mortgage Bankers Association’s (MBA) Purchase Applications Payment Index.

The national median mortgage payment for conventional loan applicants was $2,053, down from $2,056 in August and down from $2,180 in September 2023. The national median mortgage payment for FHA loan applicants was $1,753 in September, down from $1,817 in August and down from $1,920 in September 2023.

The MBA added that interest rates decreased by 31 basis points from August to September, marking the fifth consecutive decline in rates, down 100 basis points from April. The median purchase application amount increased from $320,100 to $328,000.

“Homebuyer affordability conditions improved for the fifth consecutive month, as mortgage rates near the low 6% range improved purchasing power for prospective buyers,” said Edward Seiler, MBA’s associate vice president of housing economics and executive director of the Research Institute for Housing America. “Overall affordability is now at its highest level since August 2022, but the recent jump in rates will likely cause conditions to plateau. MBA is forecasting for rates to be around 6.3 by the end of the year.”