Financial News: U.S. Mortgage Applications Fall For Second Week, Demand

U.S. Mortgage Applications Fall For Second Week, Demand For ARMs Rise: MBA

10/08/2025 - 13:22:00 (RTTNews)

(RTTNews) - Home loan applications in the U.S. declined for a second week in a row, but at a slower pace, and there was an increase in demand for the riskier adjustable-rate mortgages as homebuyers look for best deals, survey data from the Mortgage Bankers Association showed on Wednesday.

The market composite index, a measure of the house purchase mortgage loan application volume, fell a seasonally adjusted 4.7 percent in the week ended October 3 after a <a href=https://www.rttnews.com/3579123/u-s-mortgage-applications-decline-mba.aspx target=_blank >12.7 percent slump in the previous week</a>.

The MBA survey also showed that the refinance index declined 8 percent, which was much slower than the 21 percent drop in the previous week. The purchase index dropped 1 percent, same as in the previous week.

The refinance share of mortgage activity decreased further to 53.3 percent of total applications from 55.0 percent in the previous week.

The 30-year fixed mortgage rate fell to 6.43 percent, after climbing to 6.46 percent in the previous week.

"With mortgage rates on fixed-rate loans little changed last week, refinance application activity generally declined, with the exception of a modest increase for FHA refinance applications," MBA's SVP and Chief Economist Mike Fratantoni said. "Refinance volume remains somewhat elevated relative to levels of a month ago."

Despite the recent weakening, purchase activity continues to show moderate growth on an annual basis, and stronger growth for FHA loans, favored by first-time homebuyers, the economist noted.

The survey showed that the adjustable-rate mortgage, or ARM, share of activity climbed to 9.5 percent of total applications from 8.4 percent.

"Our survey shows 5/1 ARM rates are averaging almost a percentage point below 30-year fixed rates, and this differential is leading more purchase and refinance applicants to consider ARMs," Fratantoni added.

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