Mortgage Application Payments Decreased in September, MBA Reports
(Image courtesy of MBA)
Homebuyer affordability improved in September, with the national median payment applied for by purchase applicants decreasing to $2,067 from $2,100 in September. This is according to the Mortgage Bankers Association’s Purchase Applications Payment Index, which measures how new monthly mortgage payments vary across time–relative to income–using data from MBA’s Weekly Applications Survey.
“Affordability improved for the fourth consecutive month, supported by lower mortgage rates and a growing housing supply,” said Edward Seiler, MBA’s Associate Vice President of Housing Economics and Executive Director of the Research Institute for Housing America. “Affordability conditions have strengthened steadily throughout 2025, and with mortgage rates expected to stabilize and home prices remaining flat, we anticipate slightly stronger housing demand heading into 2026.”
An increase in MBA’s PAPI–indicative of declining borrower affordability conditions–means that the mortgage payment to income ratio (PIR) is higher due to increasing application loan amounts, rising mortgage rates, or a decrease in earnings. A decrease in the PAPI–indicative of improving borrower affordability conditions–occurs when loan application amounts decrease, mortgage rates decrease, or earnings increase.
The national PAPI decreased 1.6% to 155.0 in September from 157.5 in August. Preliminary estimates of median earnings, based on pre-shutdown August data, were up 3.2% compared to one year ago, and while payments increased 1.3%, the significant earnings growth means that the PAPI is down (affordability is higher) 1.9% on an annual basis. For borrowers applying for lower-payment mortgages (the 25th percentile), the national mortgage payment decreased to $1,418 in September from $1,455 in August.
The Builders’ Purchase Application Payment Index (BPAPI) showed that the median mortgage payment for purchase mortgages from MBA’s Builder Application Survey decreased to $2,162 in September from $2,210 in August.
Additional Key Findings of MBA’s Purchase Applications Payment Index (PAPI) – September 2025
• The national median mortgage payment was $2,067 in September 2025—down $33 from August. It was up by $26 from one year ago, equal to a 1.3% increase.
• The national median mortgage payment for FHA loan applicants was $1,792 in September, down from $1,863 in August but up from $1,753 in September 2024.
• The national median mortgage payment for conventional loan applicants was $2,105, down from $2,112 in August but up from $2,053 in September 2024.
• The top five states with the highest PAPI were: Idaho (242.4), Nevada (229.9), Arizona (206.6), Rhode Island (205.9), and Florida (196.8).
• The top five states with the lowest PAPI were: Louisiana (114.3), Connecticut (120.8), West Virginia (121.6), Alaska (122.7), and New York (122.9).
• Homebuyer affordability increased for Black households, with the national PAPI decreasing from 156.9 in August to 154.4 in September.
• Homebuyer affordability increased for Hispanic households, with the national PAPI decreasing from 146.6 in August to 144.3 in September.
• Homebuyer affordability increased for White households, with the national PAPI decreasing from 158.5 in August to 156.0 in September.
About MBA’s Purchase Applications Payment Index
The Mortgage Bankers Association’s Purchase Applications Payment Index (PAPI) measures how new mortgage payments vary across time relative to income. Higher index values indicate that the mortgage payment to income ratio (PIR) is higher than in a month where the index is lower. Contrary to other affordability indexes that make multiple assumptions about mortgage underwriting criteria to estimate mortgage payment level, PAPI directly uses MBA’s Weekly Applications Survey (WAS) data to calculate mortgage payments.
PAPI uses usual weekly earnings data from the U.S. Bureau of Labor Statistics’ Current Population Survey (CPS). Usual weekly earnings represent full-time wage and salary earnings before taxes and other deductions and include any overtime pay, commissions, or tips usually received. Note that data are not seasonally adjusted.
MBA’s Builders’ Purchase Application Payment Index (BPAPI) uses MBA’s Builder Application Survey (BAS) data to create an index that measures how new mortgage payments vary across time relative to income, with a focus exclusively on newly built single-family homes. As with PAPI, higher index values indicate that the mortgage payment to income ratio (PIR) is higher than in a month where the index is lower. To create BPAPI, principal and interest payment amounts are deflated by the same earnings series as in PAPI.
The rent data series calculated for MBA’s national mortgage payment to rent ratio (MPRR) comes from the U.S. Census Bureau’s Housing Vacancies and Homeownership (HVS) survey’s median asking rent. The HVS data is quarterly, and as such, the mortgage payment to rent ratio will be updated quarterly. The HVS data is quarterly, and as such, the mortgage payment to rent ratio will be updated quarterly. The MPRR data was not featured in the September 2025 data.
For additional information on MBA’s Purchase Applications Payment Index, click here.
