Although interest rates dipped last week — below 5 percent for long-term mortgages — demand for home loans declined, even with the expiration date for the first-time homebuyer tax credit quickly approaching. According to data released Wednesday by the Mortgage Bankers Association (MBA), overall mortgage activity fell 2.8 percent for the week ending September 25, compared

to one week earlier. The organization’s measure of total loan applications is down 44.3 percent from the same week in 2008. Filings for mortgage refinancing decreased 0.8 percent from the previous week, comprising 65.3 percent of total applications. Petitions for new purchases dropped by 6.9 percent. MBA’s survey results equated to disappointing news for housing markets. Until this week, purchase applications had been climbing steadily since the beginning of the year. Interest rates on 30-year fixed-rate mortgages averaged 4.94 percent last week, MBA reported. That figure is down slightly from 4.97 percent the week before. Rates for 15-year fixed-rate mortgages followed a similar downward trajectory, decreasing to 4.34 percent from 4.41 percent previously. The average contract interest rate for one-year adjustable-rate mortgages, which made up 6.2 percent of total applications last week, declined to 6.40 percent.