Mortgage rates have continued their upward trajectory, registering a substantial increase last week.

Consequently, total mortgage demand saw a decline of 6% compared to the prior week, as reported by the Mortgage Bankers Association’s seasonally adjusted index.

The average contract interest rate for 30-year fixed-rate mortgages, within the limits of conforming loan balances ($726,200 or less), rose to 7.53% from 7.41%.

This change was accompanied by an increase in points to 0.80 from 0.71, which includes the origination fee, for loans featuring a 20% down payment. For reference, this rate stood at 6.75% during the same week one year ago, CNBC reported.

“Mortgage rates continued to move higher last week as markets digested the recent upswing in Treasury yields,” said Joel Kan, MBA’s vice president and deputy chief economist. “As a result, mortgage applications ground to a halt, dropping to the lowest level since 1996.”

Applications for home loan refinancing experienced a 7% decline during the week and were down 11% compared to the same week last year.

Refinancing activity now constitutes less than one-third of all mortgage applications, a notable shift from just two years ago when record-low rates prompted refinancing to make up around three-quarters of all mortgage applications.

Applications for mortgages to purchase homes also decreased by 6% for the week and marked a 22% drop compared to the same week in the previous year.

Written by staff