07:07 AM EDT, 10/16/2024 (MT Newswires) -- Mortgage applications plunged by 17% in the week ended Oct. 11 as mortgage rates climbed for a third straight week to their highest level since August, according to Mortgage Bankers Association data released Wednesday.

This follows a 5.1% decrease in overall activity in the week ended Oct. 4.

Applications for refinancing loans fell by 26%, while new purchase applications declined by a seasonally adjusted 7%.

The average contract interest rate for 30-year fixed mortgages with loan balances of $766,550 or less rose to 6.52% from 6.36% in the previous week.

"The recent uptick in rates has put a damper on applications," said Joel Kan, MBA's vice president and deputy chief economist. "Refinance applications fell 26% to their lowest level since August, with comparable drops in both conventional and government refinances."

At the same time, rising inventory conditions are supporting new home purchases despite rising mortgage rates, Kan said.