Homes in Palm Beach Gardens, Florida, on Sunday, Jan. 11, 2026.
Zak Bennett | Bloomberg | Getty Images
Mortgage rates ticked up last week, halting a month-long decline and sending a ripple effect through the housing market. Total mortgage demand fell 8.5% compared to the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Understanding these fluctuations is key for anyone considering buying or refinancing a home right now.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $832,750 or less rose to 6.24% from 6.16%, with points increasing to 0.55 from 0.54, including the origination fee, for loans with a 20% down payment. This marked the highest rate in three weeks.
Consequently, applications to refinance a home loan dropped 16% for the week. However, refinance applications remained a substantial 156% higher than the same week last year, largely because rates were 78 basis points higher during that period.
“FHA refinance activity bucked the overall trend and increased, as FHA rates remained almost 20 basis points lower than conforming rates,” said Joel Kan, MBA’s vice president and deputy chief economist. “With rates holding in the 6 percent range, the refinance market is likely to remain sensitive to week-to-week rate movements.”
Applications for a mortgage to purchase a home were largely unchanged, decreasing just 0.4% from the prior week but remaining 18% higher year-over-year. While there’s more housing inventory available compared to last year, much of it is concentrated at the higher end of the market, leaving many buyers facing a still-pricey landscape.
“The average loan size stayed at its highest level since September 2025,” Kan added.
Mortgage rates experienced a slight dip at the beginning of this week, according to a separate survey from Mortgage News Daily. The Federal Open Market Committee (FOMC) is meeting today, and while most anticipate the benchmark interest rate will remain unchanged, markets are poised to react to any commentary from Federal Reserve Chairman Jerome Powell.
