The Mortgage Bankers Association (MBA) reported on Wednesday the mortgage application volume in the U.S. fell 3.9 percent in the week ended August 13, following a 2.8 percent gain in the previous week. This marked the biggest decline in the last four weeks.

According to the report, refinance applications plunged 5.3 percent, while applications to purchase a home increased 0.8 percent.

Meanwhile, the average fixed 30-year mortgage rate rose from 2.99 percent to 3.06 percent, the highest level in a month.

“Mortgage rates followed an overall increase in Treasury yields last week, which started higher from the strong July jobs report before slowing because of weaker consumer sentiment and concerns about rising COVID-19 cases,” noted Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. “The increase in mortgage rates caused a 5 percent decrease in refinancing, driven by a 7 percent drop in conventional refinance applications. Even though rates are 7 basis points lower than the same week a year ago, the refinance index is around 8 percent lower. The eligible pool of homeowners who stand to benefit from a refinance is smaller now.”