The number of mortgage applications is at its lowest level since February 2025 as borrowing costs rise.
Published October 7, 2026
With less than a month until the midterm elections, concerns about the cost of living are weighing on Americans, and mortgage interest rates in the United States have reached their highest level in about three years.
The average cost of a 30-year fixed-rate mortgage rose 19 basis points to 7.49% in the week ended Oct. 2, according to the Mortgage Bankers Association’s weekly report released Wednesday.
Recommended stories
list of 4 itemsend of list
Meanwhile, the number of mortgage applications fell by 4.2% from the previous week, according to the report. The number of applications is at its lowest level since February 2025 and has fallen by almost half since the beginning of the year.
“Few homeowners have an incentive to refinance at these rates, and rising borrowing costs are pushing many potential borrowers out of the purchase market,” Joel Kang, vice president and deputy chief economist at the Mortgage Bankers Association, said in a press release.
Mortgage rates are closely tied to the 10-year U.S. Treasury bond. Earlier this week, these indexes hit a 24-year high of 5.3% as oil prices soared due to ongoing tensions with Iran.
Meanwhile, the yield on the 30-year U.S. Treasury rose to 5.7% on Wednesday, the highest level since 2002.
Mortgage rates have skyrocketed since late February, when the United States and Israel first attacked Iran. Since the strike, mortgage rates have increased by 1.4%. Inflation, which rose 3.4% year-on-year, is also putting pressure on mortgage interest rates.
It comes as the cost of living has become a top concern for voters ahead of midterm congressional elections that could decide the balance of power in Washington. A Reuters/Ipsos poll in late August found that 47% of voters said the cost of living was the most important issue heading into the midterm elections.
In a separate Reuters/Ipsos poll conducted in September, 17% of voters said they approved of President Donald Trump’s handling of cost-of-living issues.
