Aerial view of two-story single-family homes lining a street in Thousand Oaks, California, on January 14, 2026.
Kevin Carter | Getty Images
Mortgage rates fell to their lowest levels in a month last week, prompting current borrowers to seek savings by refinancing. Although lower interest rates didn’t provide much of an incentive for potential buyers, a surge in refinances was enough to push overall mortgage demand up 2.8% week over week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $832,750 or less decreased from 6.21% to 6.17%, and the origination point for loans with a 20% down payment remained unchanged at 0.56, including origination fees.
“U.S. Treasury yields ended the week lower as weak data on retail sales and home sales beat job market expectations in January,” MBA Vice President and Deputy Chief Economist Joel Kang said in a release.
As a result, mortgage refinance applications increased by 7% for the week and 132% compared to the same week last year. Interest rates were 76 basis points higher last year. While this annual growth may seem large, refinances at this time last year were extremely low.
“Refinance applications increased across all loan types, making it the most active week for refinances since mid-January,” Suga added.
The number of applications for mortgages to buy homes fell by 3% for the week, and was up just 8% from the same week last year. While lower mortgage rates are making homes a little more affordable, new supply isn’t coming into the market fast enough and concerns about the overall economy are keeping consumers on the sidelines.
Mortgage rates didn’t move at all earlier this week as the holiday was cut short, but economic data due out this week could impact their current trajectory. But in general, mortgage rates have remained within a fairly narrow range between 6% and 6.25% since the beginning of this year.
