Even as rates hit their highest levels in nearly four years, mortgage application volume increased compared with one week earlier, according to the Mortgage Bankers Association.
The MBA's Weekly Mortgage Applications Survey for the week ending Feb. 2 found that the refinance index increased 1% from the previous week.
The refinance application share decreased to 46.4%, its lowest level since July 2017, from 47.8% the previous week.
The seasonally adjusted purchase index remained unchanged from one week earlier. The unadjusted purchase index increased 7% compared with the previous week and was 8% higher than the same week one year ago.
The market composite index, a measure of mortgage loan application volume, increased 0.7% on a seasonally adjusted basis from one week earlier.
Adjustable-rate loan application activity increased to 6.1% from 5.7%, while the share of Federal Housing Administration-guaranteed loans decreased to 10.4% from 10.7% the week prior.
The share of applications for Veterans Affairs-guaranteed loans remained unchanged at 10.1% and the U.S. Department of Agriculture/Rural Development share decreased to 0.7% from 0.8% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) increased to its highest level since April 2014, 4.5%, from 4.41%. For 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100), the average contract rate increased to its highest level since April 2014, 4.47%, from 4.34%.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased 7 basis points to 4.47%. For 15-year fixed-rate mortgages the average rate increased 7 basis points to 3.92%.
The average contract interest rate for 5/1 ARMs decreased 2 basis points to 3.77%.