Total mortgage applications fell last week for the first time since July and the level of purchase mortgages is down nearly 40% from the year ago. The Mortgage Bankers Association said its market composite index showed a seasonally adjusted decrease of 1.5% from the prior week with a 3.1% drop in refinancing activity. MBA vice president of research and economics Michael Fratantoni said “refinance volume dropped last week for the first time in six weeks, but the level of applications to refinance remains close to recent highs, as historically low mortgage rates continue to draw borrowers into the market.” The MBA said its seasonally adjusted purchase index for the week ended Sept. 3 climbed 6.3%  from the week earlier. “Purchase applications increased last week, reaching the highest level since the end of May,” Fratantoni said. “However, purchase activity remains well below levels seen prior to the expiration of the homebuyer tax credit, and is almost 40% below the level recorded one year ago.” In four-week moving averages, the seasonally adjusted market index is up 4.4%, the purchase index is rose 1.3% and the refinance index is up 5%. The refinancing share of mortgage activity slipped to 81.9% from 82.9% last week, which was the highest level since January 2009. MBA said the unadjusted purchase index increased 4% from the previous week and is 38.8% lower than the year ago. Interest rates for 30-year fixed and 15-year fixed mortgages inched up somewhat last week but remain at historically low levels. The average rate for the 30-year, fixed climbed to 4.5% from 4.43%, which was the one of the lowest ever recorded by the MBA. The average, fixed-rate, 15-year mortgage rose to 4% from 3.88% the week prior. Write to Jason Philyaw.

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