Mortgage rates fell again last week, but not enough to pull overall demand out of the rut it's been in for the past month. Total mortgage application volume dropped 1.2% last week compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $806,500 or less, decreased to 6.64% from 6.69%, with points falling to 0.59 from 0.60, including the origination fee, for loans with a 20% down payment. That was the lowest rate since April.

Applications to refinance a home loan, which are most sensitive to weekly rate changes, increased 1% for the week and were 20% higher than the same week one year ago. This despite the fact that at this time last year, m

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