Demand for riskier adjustable-rate mortgages hits highest level of the year, due to rising rates

Demand for adjustable-rate mortgages (ARMs) reached a yearly high, capturing 7.8% of total mortgage applications as borrowers seek lower initial rates amidst rising interest rates. The average interest rate for 30-year fixed-rate mortgages increased to 7.29%, while 5/1 ARMs dropped slightly to 6.60%. Overall mortgage applications fell by 2.3%, with reduced refinancing activity due to higher rates discouraging homeowners from altering existing low-rate mortgages.