Continued increases in mortgage rates caused the refinance loan application share to fall to its lowest level since September 2008, according to the Mortgage Bankers Association.
The Refinance Index for the week ending March 9 declined 2% from the previous week, as the recent rise in mortgage rates stretched to nine weeks. Rates for the 30-year loan are expected to near 5% by the end of the year.
But higher rates did not prevent overall mortgage application volume to increase by 0.9% on a seasonally adjusted basis and 2% unadjusted compared to a week earlier.
Refinance loan activity made up 40.1% of total applications.
The seasonally adjusted Purchase Index rose 3% from the previous week, while the unadjusted Purchase Index increased 5%, and was up 3% from the same week a year ago.
The total share of applications for Federal Housing Administration loans grew to 10.4% from 10.1% a week earlier. Applications for United States Department of Agriculture loans remained unchanged at 0.9% from the previous week.
The average contract interest rate for conforming 30-year fixed-rate mortgages (a balance of $453,100 or less) increased to its highest level since January 2014, at 4.69% from 4.65% the previous week.
The average contract interest rate for 30-year fixed rate mortgages with jumbo balances (greater than $453,100) ticked down a percentage point from 4.56% to 4.55%. The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA grew to 4.73%, its highest level since July 2011.
For 15-year fixed-rate mortgages, the average contract interest rate declined from 4.11% to 4.07%. The average contract interest rate for 5/1 ARMs increased from 3.81% to 3.93%, its highest level since February 2011.