Mortgage application activity increased month-over-month as the 30-year fixed mortgage rates reached a three-year low. The Mortgage Bankers Association’s (MBA) Market Composite Index, a measure of total mortgage application volume, increased 1.5% from January on a seasonally adjusted basis and was 56.3% higher than a year earlier. The data also indicated a rising adjustable-rate mortgage (ARM) share, increasing from 5.7% of mortgages to 8.3% over the past year.
The average contract interest rate for 30-year fixed mortgage rates declined a further seven basis points (bps) to 6.14%, tracking the decline in the 10-year treasury yield. Compared with February 2025, the 30-year fixed mortgage rate was 73 bps lower. The decline in mortgage rates supported the continued strength in refinancing activity, which increased 11.3%. On the other hand, purchase applications decreased 12.3% as tight existing-home inventory and winter storms dampened home-buying activity. Relative to February 2025, refinance and purchase activities are up 121.1% and 9.0%, respectively.
By loan type, applications for adjustable-rate mortgages (ARMs) increased 18.0% month-over-month while fixed-rate mortgages (FRMs) held steady. On a year-over-year basis, FRM applications were up 51.8%, while ARM applications more than doubled, rising 129.9%. As of February 2026, ARMs accounted for an average of 8.3% of total applications on a non-seasonally adjusted basis, up 1.2 percentage points from January and 2.6 percentage points higher than a year earlier.
Loan sizes across all loan types increased in February with the total market increasing by 3.2% to $414,800. Average purchase loan sizes increased 2.5% to $446,300, while the refinance loan size increased by 3.7% to $391,800. The average ARM loan size climbed 4.6% to $968,300.
This article was originally published by a eyeonhousing.org . Read the Original article here. .
