Mortgage rates rise above 7% as adjustable-rate loans gain share

Mortgage rates climbed to their highest level since 2024 last week, reducing overall loan demand and pushing more borrowers toward adjustablerate mortgages, according to the Mortgage Bankers Association. The average contract rate on 30year fixed mortgages for conforming loans rose to 7.12% from 6.97%. Total mortgage applications fell 1.5% from the prior week, while refinance applications dropped 3% and were 62% below the same week a year earlier. Purchase applications also declined 1% week over week and were 11% lower than a year ago. The share of adjustablerate mortgage applications increased to 9.8% from 8.4% the week before, as some borrowers looked for lower initial rates amid higher fixed borrowing costs.