Mortgage applications in the US declined by 1.2% in the week ending February 21st, extending the sharp 6.6% drop from the previous week—the steepest decline so far this year—according to data from the Mortgage Bankers Association.
US mortgage rates and applications fall
The continued downturn occurred despite a fourth consecutive week of falling benchmark mortgage rates, highlighting how elevated home prices are still discouraging potential buyers from entering the market.
Refinancing applications, which tend to react more quickly to interest rate movements, dropped by 4%, following a 7% decline in the prior week. Meanwhile, applications for home purchase loans remained unchanged, maintaining the 6% drop from the previous period and marking the fifth straight week without meaningful growth.
30-year rate declines
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) continued its decline, reaching 6.88% in the week ending February 21st, down from 6.93% the previous week and hitting its lowest level since December 2024. By comparison, the rate stood at 7.03% a year earlier.
“Mortgage rates declined as Treasury yields moved lower in response to softer consumer spending data, which signaled a more cautious outlook on the economy and job market. As a result, the 30-year fixed rate dropped to 6.88%, the lowest level since mid-December,” said Joel Kan, MBA’s vice president.
