Rising interest rates deterred refinancing activity last week, resulting in a sharp decline in overall mortgage applications, an industry trade group said.

The Mortgage Banker's Association said its market composite index — a measure of mortgage loan volume — fell 7.4% from a week earlier as refinancing activity declined 9%.

The purchase index, on the the other hand, remained relatively stable, while still falling a slight 0.9% from last week.

As rates rose and refinancing activity declined, refinance applications ended up representing 80% of all mortgage apps, down from 81% a week earlier. 

The drop in refinancing activity corresponded to rising rates with the 30-year, fixed-rate conforming loan increasing to 3.86% from 3.76%.

The average interest rate for a 30-year, FRM with a jumbo loan balance hit 4.11% from 4.03%.

In addition, the average contract interest rate for the 30-year, FRM backed by the FHA grew to 3.62% from 3.53%.

The 15-year, FRM rose to 3.15% from 3.12%, while the rate for 5/1 ARMS edged up to 2.74% from 2.73%.