Mortgage Application Volume Drops 2.6%

Mortgage applications fell another 2.6 percent (seasonally adjusted) for the week ending July 12, the ""Mortgage Bankers Association"":http://mbaa.org/default.htm (MBA) reported in its Weekly Mortgage Applications Survey.

[IMAGE] [COLUMN_BREAK]

The Market Composite Index, a measure of loan application volume, fell once again as mortgage rates hovered. On an unadjusted basis, the index was down 22 percent compared to the previous week.

The Refinance Index dropped 4 percent from the previous week, dipping to its lowest level since July 2011. The refinance share of mortgage activity also hit a two-year low, falling to 63 percent--the lowest level since April 2011.

Meanwhile, the seasonally adjusted Purchase Index saw a slight bump, rising 1 percent from the prior week. The unadjusted Purchase Index increased 26 percent week-over-week and was 5 percent higher than the same week last year.

The average contract interest rate for a 30-year fixed-rate mortgage was 4.68 percent, unchanged from the prior week. However, points fell to 0.42 from 0.46 for 80 percent loan-to-value ratio loans, bringing the effective rate down.