A rise in mortgage interest rates has led to a decline in people applying for home loans and homeowners refinancing.

One such local was 55-year-old Muhammad Ijaz, who had applied for a small loan of Rs15,000 through a loan application and ended up with severe mental trauma.

Declining mortgage interest rates helped boost home loan applications for a second week, as the summer selling season is underway.

Additionally, the overall average loan size at $380,200 was the lowest since January 2025.” The adjustable-rate mortgage (ARM) share of activity decreased to 7.1% of total applications.

Applications for home purchases, which have been slow amid a stagnant market, also increased 38 percent during the week. Refinance volume accounted for 69.1 percent of all applications, up from 49 ...