The demand for mortgage refinancing has surged by 94% compared to the previous year, due to the decline in interest rates.

• The interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased from 6.44% to 6.43%.
• The number of mortgage applications for purchasing a home increased by 3% during the week, but is still 4% lower compared to the same week last year.

Refinancing mortgage demand has increased significantly due to the decline in interest rates for five consecutive weeks.

The Mortgage Bankers Association's seasonally adjusted index showed a 1.6% increase in total mortgage application volume last week compared to the previous week.

The interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased by 78 basis points from the same week one year ago, with points increasing to 0.56 from 0.54 (including the origination fee) for loans with a 20% down payment.

Despite a 0.3% decline in applications to refinance a home loan for the week, they were 94% higher than the same period last year. Although this may seem like a significant increase, it is a positive sign for a business that has been severely impacted by higher interest rates and weak homebuying.

"The refinance share of applications in August was the highest monthly average since March 2022, despite a slight decline in refinance applications, according to Joel Kan, an MBA economist."

The number of mortgage applications for purchasing a home increased by 3% during the week, but it is still 4% lower compared to the same week last year. Despite the decline in interest rates, home sales have been sluggish all summer due to the high home prices.

Government loan demand led to a slight increase, with FHA and VA loans being popular among lower-income buyers due to their low or no down payment options.

On Tuesday, mortgage rates remained relatively stable, with the focus being on the monthly employment report and other economic information that would be released later in the week.