Mortgage application volume took a steep dive during the week ending Sept. 5, mainly due to the Labor Day weekend.
Overall, application volume fell 7.2%, on an adjusted basis, compared to the previous week, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
On an unadjusted basis, volume decreased 17% compared with the previous week.
Applications for refinances fell a massive 11% to reach the lowest level since November 2008, the MBA reports. Applications for purchases fell 3%.
On an unadjusted basis, purchase application volume was down 14% compared with the previous week and was down 12% compared to the same week one year ago.
The refinance share of mortgage activity fell to 55% of total applications, down from 57% the previous week.
The major drop in application volume for refinances comes despite the fact that mortgage interest rates continue to hover at near-historical lows.
The average rate for a 30-year fixed-rate mortgage (FRM) with conforming loan balance ($417,000 or less) was 4.27% last week, up from 4.25% the previous week. This was the first increase for the 30-year fixed mortgage in four weeks, according to the MBA.
The average rate for a 30-year FRM with jumbo loan balance (greater than $417,000) was 4.15%, down significantly from 4.22% the week prior.
The average rate for a 30-year FRM backed by the Federal Housing Administration was 3.97%, down slightly from 3.99% the previous week.
The average rate for a 15-year FRM was 3.44%, down from 3.48% the week prior.
The average rate for a 5/1 adjustable-rate mortgage (ARM) was 3.12%, down from 3.19%.
The ARM share of activity fell to 7.5% of total applications, down from 7.8% the previous week.