Mortgage applications tumbled this week as refinancing and purchase applications continued their downward trend.
Application volume fell 9.8% from one week earlier for the week ending May 17, according to the Mortgage Bankers Association.
Also posting significant drops, the refinance Index decreased 12% from the previous week and the seasonally adjusted purchase index dropped 3% from one week earlier, the industry trade group said.
"Mortgage rates increased to their highest level since March last week, leading to the largest single week drop in refinance applications this year," said Mike Fratantoni, MBA’s vice president of research and economics.
He added, "The refinance index has fallen almost 19% over the past two weeks and is back to its lowest level since late March. Purchase activity declined over the week but is still running about 10% above last year’s pace at this time."
The refinance share of overall mortgage activity slightly fell to 74% of total applications.
Meanwhile, the adjustable-rate mortgage share of activity inched up to 5% of all mortgage applications.
The average 30-year, fixed-rate mortgage with a conforming loan balance continued to escalate, rising to 3.78% from 3.67%.
Additionally, the average 30-year, FRM with a jumbo loan balance rose to 3.93% from 3.87% compared to a week prior.
The average contract interest rate for the 30-year, FRM backed by the FHA surged to 3.53% compared to 3.43% the previous week.
The 5/1 ARM squeaked up to 2.60% from 2.55%, and the 15-year, FRM jumped to 2.96% from 2.88.