Mortgage applications rose 2% on a week-over-week, seasonally adjusted basis in the week ended Dec. 3, while the average 30-year fixed-mortgage rate slid to 3.30% from 3.31% in the preceding week, the Mortgage Bankers Association said, citing its Market Composite Index.

The average contract interest rate for 30-year fixed-rate mortgages backed by the Federal Housing Administration decreased to 3.35% from 3.42%. The average contract interest rate for a 15-year fixed-rate mortgage climbed to 2.62% from 2.63%, while the average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances of more than $548,250 increased to 3.33% from 3.27%. 

On an unadjusted basis, the market composite index, which measures mortgage-loan application volume, jumped 45% from the previous week. The refinance index, meanwhile, rose 9% from the previous week and was down 37% from the same week a year ago. The refinance share of mortgage activity increased to 63.9% of total applications from 59.4% the previous week.

“Mortgage rates declined for the first time in a month, prompting a pickup in refinancing, with government refinances increasing more than 20% over the week,” MBA associate vice president of economic and industry forecasting Joel Kan said in a press release. “While the 30-year fixed mortgage rate and 15-year fixed mortgage rate both declined only one basis point, the FHA rate fell 7 basis points, driving the surge in government refinances. Borrowers are continuing to act on these opportunities, but if rates trend higher as MBA is forecasting, the window of opportunity to refinance will continue to get smaller.”

The adjustable-rate mortgage share of activity slid to 3% of total applications. The FHA share of total applications increased to 9.9% from 8.9% in the preceding week, while the VA share of applications rose to 10.7% from 10%. The USDA share of applications was flat at 0.5%.

The seasonally adjusted purchase index slid 5% from the previous week, while the unadjusted purchase index rose 28% on a weekly basis and declined 8% on an annual basis.