Mortgage Applications Today: Home Loan Refinancing Rebounds—Soaring 40% After Holiday Slump

Home loan demand surged 28.5% for the week ending Jan. 9, according to the Mortgage Bankers Association. The increase comes after a holiday slump in which mortgage demand saw at least three weeks of declines. The results include an adjustment for the New Year's Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 28.5% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 65% compared with the previous week.

The Refinance Index increased 40% from the previous week and was 128% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 16% from a week earlier. The unadjusted Purchase Index increased 51% compared with the previous week and was 13% higher than the same week one year ago.

The demand for home loans comes as mortgage interest rates held steady. The average rate on a 30-year fixed mortgage is 6.16% for the week ending Jan. 8, according to Freddie Mac.

The refinance share of mortgage activity increased to 60.2% of total applications from 56.6% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7% of total applications.

In the second half of 2025, the share of homeowners carrying mortgages above 6% surpassed those with rates below 3%, according to a Realtor.com® report on outstanding debt.

The Federal Housing Administration (FHA) share of total applications decreased to 19.2% from 20% the week prior. Veterans Affairs loans share of total applications decreased to 16.1% from 17.3% the week prior. The USDA share of total applications remained unchanged at 0.4% from the week prior.

"Mortgage rates dropped lower last week following the announcement of increased MBS purchases by the GSEs. Lower rates, including the 30-year fixed rate declining to 6.18 percent, sparked an increase in refinance applications,” said Joel Kan, MBA’s vice president and deputy chief economist.

"Compared to a holiday adjusted week, refinance applications surged 40 percent to the strongest weekly pace since October 2025. The average loan size for refinance applications was also higher, as borrowers with larger loan sizes are typically more sensitive to changes in rates."

Contract rates

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($832,750 or less) decreased to 6.18% from 6.25%, with points decreasing to 0.56 from 0.57 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $832,750) increased to 6.42% from 6.32%, with points increasing to 0.43 from 0.42 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.  

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 6.08% from 6.09%, with points decreasing to 0.68 from 0.77 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.60% from 5.64%, with points decreasing to 0.61 from 0.64 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 5.42% from 5.90%, with points increasing to 0.49 from 0.19 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week. 

Mortgage rates calculated

Mortgage rates are calculated by various factors in the economy, and the length of your loan will also figure into the mortgage rate you qualify for.

The 30-year mortgage rate is tied to the yield of the 10-year Treasury note, according to Fannie Mae. As the yield on the 10-year Treasury note moves, mortgage rates follow.

The yield on the 10-year Treasury note is determined by expectations for shorter-term interest rates in the economy over the duration of a bond, plus a term premium.