Mortgage application volume continued its upward trajectory last week, increasing 2.7% on a seasonally adjusted basis and 13% on an unadjusted basis according to Mortgage Bankers Association (MBA) data. It follows a 1.1% seasonally modified weekly gain and 10% unadjusted increase for the week ending June 20.

While purchase applications were essentially flat week over week, the overall increase was driven by refinancing activity as homeowners took advantage of slightly lower interest rates that dipped below 6.8%. The association’s refinance index, which is not adjusted seasonally, increased 7% from the prior week and was 40% higher than the same week a year ago.

“Mortgage rates were lower across all loan types last week, with the 30-year fixed rate declining to its lowest level since April at 6.79%,” stated Joel Kan, MBA’s vice president and deputy chief economist, in a press release. “This decline prompted an increase in refinance applications, driven by a 10% increase in conventional applications and a 22% increase in VA [Veterans Affairs] refinance applications.”

The refinance share of mortgage activity increased to 40.1% of total applications from 38.4% the week prior. The adjustable-rate mortgage (ARM) share increased to 7.8% from 6.9% the previous week.

“As borrowers with larger loans tend to be more sensitive to rate changes, the average loan size for a refinance application increased to $313,700 after averaging less than $300,000 for the past six weeks,” Kan noted.

Government loans were a mixed bag. The Federal Housing Administration share of applications fell to 18.2% of the pie from 19.3% the week before. The VA share increased to 12% from 11.7% the prior week, while the U.S. Department of Agriculture share was unchanged at 0.5%.

The 6.79% interest rate for 30-year mortgages mentioned by Kan is the rate for conforming loan balances of $806,500 or less. It stood at 6.88% the previous week. Meanwhile, the 30-year rate for jumbo loan balances greater than that dollar threshold decreased to 6.78% from 6.88%, and the 15-year fixed rate fell to 6.06% from 6.11%, according to the MBA.

Freddie Mac’s weekly rate survey saw the 30-year rate averaging 6.77% and the 15-year rate averaging 5.89% for the seven-day period ending June 26.