Demand for U.S. mortgage applications climbed last week from an eight-year low a week earlier, as home loan rates dipped from near 12-month peaks, according to data from the Mortgage Bankers Association on Wednesday.
The trade group's seasonally adjusted mortgage application index rose 2.8 percent to 432.6 in the week ended Aug. 1, following the prior week's 14.1-percent drop, the most severe fall in percentage terms since May.
Total mortgage applications, based on this measure, had slumped to their lowest level since December 2000 a week ago.
The refinancing applications index climbed 4.4 percent to 1,121.8 last week, while the home purchase applications gauge rose 1.8 percent to 315.2 on a seasonally adjusted basis, the MBA said.
Fixed 30-year mortgage rates averaged 6.41 percent in the week, down from 6.46 percent a week ago and a one-year high of 6.59 percent the previous week.
The combination of rising borrowing costs and tighter lending practices makes it tougher to get loans approved, curbing sales during the worst U.S. housing market since the Great Depression.