30-Year Mortgage Rate Hits 7.12%, Highest Since May 2024, Squeezing Loan Demand

The average rate on a 30-year fixed-rate mortgage rose to 7.12% in the week ended September 18, the highest since May 2024, the Mortgage Bankers Association said. The rate climbed 15 basis points from 6.97% a week earlier, lifting borrowing costs and weighing on loan demand. Total application volume fell 1.5% week over week on a seasonally adjusted basis. Refinance applications dropped 3% and stood 62% below year-ago levels, the slowest pace since February 2025. Purchase applications slipped 1% and ran 11% under the prior-year pace. Borrowers shifted toward adjustable-rate mortgages as fixed rates rose. The ARM share of applications climbed to 9.8% from 8.4%, while the average 5/1 ARM rate fell to 6.10% from 6.23%. The Federal Reserve raised its benchmark rate a quarter point to 3.75%–4.00%, with most policymakers projecting at least one more increase this year. Mortgage rates, tracking Treasury yields, have risen more than one percentage point since the Iran conflict began.