Mortgage applications dip 0.3% as FHA and ARM shares rise

Mortgage applications decreased 0.3% from one week earlier, according to data from the Mortgage Bankers Association (MBA)’s weekly mortgage applications survey for the week ending Feb. 6.

On an unadjusted basis, the index increased 2% compared with the previous week. The seasonally adjusted purchase index decreased 2% from one week earlier. The unadjusted purchase index increased 4% compared with the previous week and was 4% higher than the same week one year ago.

The refinance index increased 1% from the previous week and was 101% higher than the same week one year ago. Refinance activity, meanwhile, decreased to 56.4% of total applications, down from 57.1% the previous week.

“Mortgage applications were relatively flat over the week, but it was a mixed bag for the different loan types. The 30-year fixed rate was unchanged at 6.21%, and conventional applications declined for both purchases and refinances as borrowers held out for another drop in rates or shifted to other loan types,” said Joel Kan, MBA’s vice president and deputy chief economist. “FHA purchase and refinance applications increased, helped partially by the FHA rate declining and remaining 20 basis points lower than the conforming 30-year fixed rate.

“Borrowers are increasingly utilizing FHA loans as affordability challenges remain, despite recent improvements. Similarly, the ARM share increased to a seven-week high with ARM rates almost a percentage point lower than fixed rates,” Kan added.

All products saw increases in activity from the week prior, aside from the U.S. Department of Agriculture (USDA) share of total applications, which remained unchanged at 0.4%.

The adjustable-rate mortgage (ARM) share of activity increased to 8% of total applications. The Federal Housing Administration (FHA) share increased by 60 basis points to 18.4%, and the U.S. Department of Veterans Affairs (VA) share grew by 20 bps to 16%.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances remained unchanged at 6.21%, while the average rate for 30-year fixed mortgages with jumbo loan balances decreased by 2 bps to 6.3%.

The average rate for 30-year fixed mortgages backed by the FHA decreased by 3 bps to 6.01%, while rates for 5/1 ARMs decreased by 4 bps to 5.33%. Conversely, the average rate for 15-year fixed mortgages increased by 4 bps to 5.65%.

Xactus Mortgage Intent Index

Data from the Xactus Mortgage Intent Index — which analyzes aggregated, anonymized credit-pull activity across the Xactus Intelligent Verification Platform — found that mortgage application activity increased this week as borrowers returned to the market following disruptions caused by Winter Storm Fern.

The index tracking borrower intent rose 6.88% from the previous week, signaling a rebound in demand, said Thomas Lloyd, chief strategy officer for Xactus.

Still, activity has not fully returned to levels seen before the storm, indicating lingering effects may continue to temper momentum.

January ended with modest gains. Monthly volume was up 5.25% compared with January 2025, and year-to-date borrower intent is running 2.2% higher than the same period last year, despite softer activity over the past two weeks.