Mortgage application volume was lower than the week before as both refinance and purchase activity declined.

The Mortgage Bankers Association's weekly index decreased 2.7% on a seasonally adjusted basis for the period ending Aug. 8. A week earlier, the index was up 1.6%.

The refinance index fell 4% week over week to its lowest level in three months, the Washington-based trade group said on Wednesday. There was also a 1% drop in purchase activity compared to a week ago. Meanwhile, government purchase loan applications decreased by 1% on a weekly basis, which is a new low point not seen since 2007, MBA said.

Refinances accounted for 54% of total applications, down one percentage point from a week before. The adjustable rate mortgage share remained unchanged at 8%.

All interest rates declined during this weekly period except for 30-year fixed mortgages, which held steady at 4.35%.

Both the average 30-year fixed jumbo mortgage and mortgages backed by the Federal Housing Administration compressed by two basis points, to 4.24% and 4.04%, respectively. A 15-year fixed-rate mortgage fell three-basis points, to 3.48%.

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