The share of mortgage refinance applications dropped to its lowest level in nearly 10 years as interest rates continued to climb.

The Mortgage Banker Association's Weekly Mortgage Applications Survey for the week ending March 16 found that the refinance index decreased 5% from the previous week.

The refinance share of mortgage activity decreased to its lowest level since September 2008, 38.5% of total applications, from 40.1% the previous week.

The market composite index, a measure of mortgage loan application volume, decreased 1.1% on a seasonally adjusted basis from one week earlier.

Refis plunge

The seasonally adjusted purchase index increased 1% from one week earlier. The unadjusted purchase index increased 2% compared with the previous week and was 6% higher than the same week one year ago.

Adjustable-rate loan activity decreased to 7% from 7.3%, while the share of Federal Housing Administration-guaranteed loans decreased to 10.3% from 10.4% the week prior.

The share of applications for Veterans Affairs-guaranteed loans increased to 10.7% from 10.3% and the U.S. Department of Agriculture/Rural Development share decreased to 0.8% from 0.9% the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased 1 basis point to 4.68%. For 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100), the average contract rate remained unchanged at 4.55%.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased 4 basis points to 4.69%. For 15-year fixed-rate mortgages the average rate increased to its highest level since April 2011, 4.12%, from 4.07%. The average contract interest rate for 5/1 ARMs decreased 4 basis points to 3.83%.

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