Mortgage applications dropped slightly last week

Mortgage applications fell last week as refinancing and purchases dropped despite mortgage rates remaining near historic lows. 

The index dropped 2.4 percent for the week ended April 6, as refinancing decreased 3.1 percent and purchases were down 0.5 percent, the Mortgage Bankers Association reported Wednesday. 

The four-week moving average, a less volatile gauge, is down 2.08 percent as refinancing fell 3.45 percent. Purchases, on the other hand, increased 2.19 percent.

The refinance share of mortgage activity decreased for the eighth consecutive week to 70.5 percent of total applications from 71.2 the previous week, the lowest refinance share since July 29.  

In March, the share of applications for investment properties increased to 8.3 percent from 7.4 percent in February.  

However, the increase in investor share was driven by refinance applications for investment properties, which increased to 9.2 percent in March from 7.7 percent the previous month, as the share of purchase applications for investment homes decreased over the month, to 5.7 percent in March from 6.1 percent. 

The investor share of purchase applications also decreased year over year, falling slightly to 5.7 percent last month from 5.8 percent a year ago. 

Meanwhile, interest rates remained low across the board, all hitting their lowest level since March 9. 

The average contract interest rate for 30-year fixed-rate mortgages for loans of $417,500 or less decreased to 4.10 percent from 4.16.

The rate for jumbo loan balances (greater than $417,500) decreased to 4.43 percent from 4.46 percent.

For 30-year fixed-rate mortgages backed by the FHA, the rates dropped to 3.87 percent from 3.89 percent.  

The rate for 15-year fixed-rate mortgages decreased to 3.37 percent from 3.4 percent, and the rate for 5/1 adjustable rate mortgages decreased to 2.89 percent from 2.93 percent.