Mortgage applications jumped 9.4% last week as mortgage rates fell to their lowest level in three months, the Mortgage Bankers Association said, citing its Weekly Mortgage Applications Survey.           

The average contract interest rate for conforming 30-year mortgages of $806,500 or less ticked two basis points lower to 6.77% from 6.79% the week before, while the rate for 30-year fixed-rate mortgages backed by the Federal Housing Administration slid to 6.51% from 6.53%.      

By mortgage type, purchase applications were up 9% week over week when adjusted for the Independence Day holiday and up 25% year over year, while refinancing activity was up 9% week over week and 56% year over year.   

“After adjusting for the July 4th holiday, purchase applications increased to the highest level of activity since February 2023 and remained above year-ago levels,” MBA Deputy Chief Economist Joel Kan said. “Homebuyer demand is being fueled by increasing housing inventory and moderating home-price growth. The average loan size on a purchase application, at $432,600, was at its lowest since January 2025. The refinance index also increased over the week, with VA refinances in particular up 32%.”