Weekly mortgage demand flat, interest rates drop for the third straight week

The average rate on the most popular mortgage, the 30-year fixed, fell for the third straight week, but demand for mortgages didn’t move much.

Total mortgage application volume increased 0.5% last week, compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. This after demand surged the week before.

Last week, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.73% from 6.77%, with points falling to 0.64 from 0.65 (including the origination fee) for loans with a 20% down payment.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo…