The number of mortgage applications fell last week as interest rates moved higher, the Mortgage Bankers Association reported today.

The market composite index, which measures total home loan application volume, was down 5.5 percent last week on a seasonally adjusted basis from the week before. Leading the decline was a 6.4 percent drop in the index that tracks refinancings, followed by a 5 percent decrease in the purchase loan index.

“Given the current turmoil in the mortgage market, week-to-week changes in the purchase applications index should be treated with a certain degree of caution,” Jay Brinkmann, MBA’s vice president of research and economics, said in a statement. “For example, the sudden exit of a major originator several weeks ago may have led to a bump up in applications over the last two weeks as those borrowers caught in the shutdown reapplied for mortgages at other institutions. The drop in applications we see here may be an indication that those borrowers have now been taken care of.”

Average interest rates continued to climb last week, with the rate on 30-year fixed-rate mortgages rising to 6.49 percent from 6.45 percent, the 15-year fixed edging up to 6.2 percent from 6.19 percent, and the one-year ARM rate growing to 5.84 percent from 5.81 percent.

Points, which are loan-processing fees expressed as a percent of the total loan amount, averaged 1.48 on the 30-year loans, 1.1 on the 15-year, and 1.05 on one-year ARMs. These points include the origination fee and are based on loan-to-value ratios of 80 percent.

The refinance share of mortgage activity remained unchanged Friday at 39.9 percent of total applications, according to MBA, while the ARM share of activity decreased to 18.6 percent from 21 percent the previous week.

The Mortgage Bankers Association survey covers approximately 50 percent of all U.S. retail residential mortgage originations, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.

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