Only fixed-rate mortgages (FRMs) continued to trend downward last week according to the results of Freddie Mac's Primary Mortgage Market Survey. Shorter term rates were all up slightly in that survey as were all rates in the Weekly Mortgage Applications Survey released by the Mortgage Bankers Association (MBA) for the week ended August 10.

The Freddie Mac survey found that the 30-year FRM had an average contract interest rate of 6.59 with 0.4 point for the week, a drop of 9 basis points from the week ended August 2. Fees and points that week averaged 0.3.

The 15-year FRM averaged 6.25 percent with 0.4 point compared with 6.32 percent with 0.3 point one week earlier.

The average rate for five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) was 6.33 percent up 4 basis points from one week earlier. Fees and points averaged 0.5 both weeks.

One-year Treasury-indexed ARMs were also up from the previous week, 5.65 percent with 0.5 point compared to 5.59 percent also with 0.5 point.

"Interest rates on prime conforming fixed-rate mortgages eased further in the past week, according to the Primary Mortgage Market Survey, even though other sources such as HSH Associates reported that jumbo fixed rates increased by a quarter percent or more last week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Job creation fell short of market expectations, with 92,000 jobs added in July, the smallest gain since February, and June's number was revised down by 6,000. In addition, the unemployment rate ticked up for the first time in four months to 4.6 percent.

"Freddie Mac reported that the amount of home equity cashed out through refinancing totaled $76.7 billion in the second quarter," Nothaft said. "Although slightly higher than the previous quarter's level, it still reflected a drop of $24.5 billion compared to the same quarter last year. Both the tightening of underwriting standards and slackening house price appreciation are possible contributing factors to the decline."

The MBA survey pegged the 30-year FRM at 6.45 percent with 1.54 points, including the origination fee. The previous week the rate was 6.41 percent with 1.62 points.

The average contract interest rate for the 15-year FRM increased from 6.16 percent to 6.19 percent with points decreasing from 1.18 to 1.16. The one-year ARM was up from 5.69 percent with 1.09 points to 5.81 percent with 1.11 points. All rates quoted are for 80 percent loan to value conforming loans.

The volume of mortgage applications was up 3.4 percent from the previous week on a seasonally adjusted basis and 2.7 percent unadjusted and was 20.6 percent higher than one year ago.

Doug Duncan, MBA's chief economist and senior vice president said, "Recent upheavals in the mortgage industry may be temporarily increasing the level of retail application activity at the large lenders that participate in the MBA survey rather than representing a system-wide increase"

Refinancing as a share of all market activity remained at 39.9 percent and the market share of adjustable rate mortgages decreased to 21.0 percent from 22.5 percent the previous week.