by Calculated Risk on 10/05/2005 11:00:00 AM

The Mortgage Bankers Association reports a slight decline in mortgage applications:

The Market Composite Index — a measure of mortgage loan application volume – was 713.5, a decrease of 1.1 percent on a seasonally adjusted basis from 721.2 one week earlier. On an unadjusted basis, the Index decreased 1.2 percent compared with the previous week and was down 1.8 percent compared with the same week one year earlier.

The interest rate for 30-year fixed-rate mortgages increased to 5.94% and the interest rate for a 1 year ARM to 5.13 percent from 5.02 percent one week earlier. This is the 2nd week since early '02 that the 1 year ARM has been above 5%. (See graph on Angry Bear)

Refinance activity remains strong:

The refinance share of mortgage activity increased to 44.5 percent of total applications from 43.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 29.8 percent of total applications from 28.8 percent the previous week.

With rising rates, I'm surprised at the level of refinance activity.