Freddie Mac reported that the 30-year fixed-rate mortgage averaged 6.53% in the week ending May 28, up from 6.51% the prior week and the highest level since Aug. 2025. The 15-year fixed-rate mortgage averaged 5.87%, up from 5.85% a week earlier.
The 30-year fixed rate has climbed 30 basis points over the past five weeks, according to CNBC. A year ago, the 30-year rate stood at 6.89%.
The elevated rates are weighing on borrower activity. The Mortgage Bankers Association's seasonally adjusted index showed overall application volume declined 8.5% week over week. Refinance applications dropped 18% for the week, while applications to purchase a home slipped 0.4%.
"The highest mortgage rates since last August have slowed borrower demand in recent weeks," Bob Broeksmit, president and CEO of the Mortgage Bankers Association, said in a statement, according to Yahoo Finance.
Breaking down the declines by loan type, VA applications took the steepest hit at 34%, followed by FHA at 18% and conventional refinances at 14%, CNBC reported. Refinances shrank to just 38% of all applications filed — a proportion not seen since June 2025. Meanwhile, purchase borrowers with smaller loan balances stepped back from the market amid the elevated rate environment, pushing the average purchase loan size to a record $473,600.
Uncertainty tied to the Iran war has contributed to the rate environment, according to Yahoo Finance. A perceived opening toward de-escalation in the Iran conflict led bond yields to retreat early this week, pulling mortgage rates down with them.
For prospective buyers and sellers, the roughly half-point climb in rates since February has squeezed affordability and driven many to the sidelines, per Yahoo Finance. Zillow cut its 2026 home sales growth projection to 1.2% from 4%, pointing to the drag from higher energy costs.
Despite the slowdown in applications, Sam Khater, Freddie Mac's chief economist, noted that pending home sales have risen for three consecutive months. "Homebuyers are ready to jump back into the market if mortgage rates decline," Khater said in a statement.