Despite the decline, applications for purchases were up slightly from a week earlier. However, the Refinance Index dropped 6 percent in the same period.
"Total purchase applications increased last week, due to an almost 7 percent increase in purchase applications for government loans," said Mike Fratantoni, MBA's vice president of research and economics. "This was likely driven by borrowers applying for loans prior to the scheduled increase in FHA premiums that took effect on April 1,"
Mortgage rates continued to hover around all-time lows during the week ending March 28, which could help application volume pick up in the coming weeks, according to Freddie Mac's latest Primary Mortgage Market Survey.