Mortgage applications rose last week as the 30-year fixed mortgage rates fell to it 3-week low. This boosted the applications for refinancing.

The average 30-year mortgage rates dropped to 5.17 percent falling 0.19 percentage point in the week ended July 31, the lowest since 5.05 percent in the week ended July 10.

The decline in interest rates pushed refinance applications up 7.2 percent to 1,996.7 last week, stimulating total loan requests to increase 4.4 percent to 517.3.

Although the refinance index has jumped 35 percent from its June levels, it is still well below the 6,000 level in March when the 30-year mortgage rates sank to a record low of 4.61 percent in March.

Purchase loan requests increased 0.9 percent last week to 264.4 and had been stuck within that range for months.