# Nearly 10% of borrowers turn to risky mortgages as rates hit 7%

> Mortgage rates soared past 7% last week, pushing borrowers toward adjustable-rate loans they would normally avoid.
- Title: Nearly 10% of borrowers turn to risky mortgages as rates hit…
- Summary: Mortgage rates soared past 7% last week, pushing borrowers toward adjustable-rate loans they would normally avoid. Mortgage rates jumped to 7.12%, the…
- Keywords: mortgage rates, adjustable-rate mortgages, housing market, mortgage bankers association, refinancing, home purchases, business, finance, Nearly, borrowers, turn, risky
- Source: CNBC — https://cnbc.com/2026/09/23/nearly-10percent-of-borrowers-opted-for-riskier-mortgages-last-week.html
- Author: Diana Olick
- Published: 2026-09-23T11:00:01+00:00
- Read time: 1 min
- Topics: mortgage rates, adjustable-rate mortgages, housing market, mortgage bankers association, refinancing, home purchases, business, finance
## Rates jump to highest level since 2024
The average contract interest rate for thirty-year fixed-rate mortgages with conforming loan balances increased to seven point one two percent from six point nine seven percent last week.
## Mortgage applications fall as rates rise
Total application volume decreased one point five percent from the previous week, according to the Mortgage Bankers Association's seasonally adjusted index, as higher rates dampened demand.
## Refinancing hits lowest level since February
Applications to refinance a home loan dropped three percent for the week and were sixty two percent lower than the same week one year ago, the lowest level since February twenty twenty-five.
## Home purchase applications also decline
Applications for a mortgage to purchase a home fell one percent for the week and were eleven percent lower year over year, as the fall housing market faces a sharp pullback due to higher rates.
## Nearly 10% choose adjustable-rate mortgages
The ARM share of mortgage applications jumped to nine point eight percent, up from eight point four percent the week before, as rates for five slash one ARMs were more than a percentage point lower than fixed rates.

> With fixed rates much higher, more borrowers opted for ARMs, with the ARM share reaching 9.8%, as rates for 5/1 ARMs were more than a percentage point lower than those for fixed rate loans.
## Rates ease slightly as oil prices fall
Mortgage rates moved slightly lower to start this week, according to Mortgage News Daily, as the price of oil fell and bond yields moved lower as a result.
## Key takeaway

Mortgage rates jumped to 7.12%, the highest since 2024, driving nearly 10% of borrowers to choose adjustable-rate mortgages instead of fixed-rate loans.