The Mortgage Bankers Association on Wednesday reported its Market Composite Index, which measures mortgage loan application volume, fell 0.8% sequentially last week on a seasonally adjusted basis, driven by fewer requests for refinancing. On an unadjusted basis, the index was down 1%.

However, the Purchase Index, which measures volume for mortgage applications for home purchases, continued its recent upward trend with a gain of 2.4%, seasonally adjusted, 1.5% unadjusted. It was driven by a 4.5% increase in government purchase applications, with conventional appliations posting a 0.8% increase. Still, that index was 32.4% behind the comparable week last year.

The four week moving average for the seasonally adjusted Market Index was down 3.3%, but the Purchase Index was up1.1%.

The refinance share of mortgage activity decreased to 80.7% from 81.1% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6% from 5.9%.

The average contract interest rate for 30-year fixed-rate mortgages fell to a new record low of 4.38% from 4.44%, with points increasing to 1.01 from 0.81 (including origination fee) for 80% loan-to-value (LTV) ratio loans. The rate for 15-year fixed-rate mortgages decreased to 3.77% from 3.88%, also a new low, with points increasing to 1.13 from 0.86. The 15-year contract rate is the lowest recorded in the survey, while the previous low was observed last week. The average contract interest rate for one-year ARMs increased to 7.04% from 6.96%, with points increasing to 0.22 from 0.21.