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Refinance Demand Drops Sharply as Mortgage Rates Hit a Nine-Month High

  • May 27th

by UrbanTurf Staff

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Mortgage rate chart_05-21-26.png

The refinance window closed a little further last week, as climbing borrowing costs sent mortgage application volume tumbling 8.5% — the steepest single-week drop in recent months, according to the Mortgage Bankers Association's latest survey.

The 30-year fixed rate on conforming loans rose to 6.65%, its highest level since August 2025, capping a 30-basis-point run-up over just five weeks. Refinance applications bore the brunt of the move, falling 18% on the week. Despite that pullback, they remained 19% above the same period last year — a reflection of how much worse the rate environment was in spring 2025. 

Purchase applications held up better, declining just 0.4% for the week, though year-over-year comparisons have been shrinking: buyers were only 5% ahead of last year's pace, down from double-digit annual gains seen earlier this spring.

There was a modest bright spot heading into this week, however: the potential for a de-escalation in the war with Iran pushed bond yields lower, and mortgage rates followed, ticking down slightly at the start of the week.

See other articles related to: mortgage demand

This article originally published at https://dc.urbanturf.com/articles/blog/refinance_demand_drops_sharply_as_mortgage_rates_hit_a_nine-month_high/24670.

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