For the week ending June 22, the Refinance Index declined 8% to 4955 from 5386 - its highest level since April 2009. Over the previous two weeks, the index jumped 20% largely as a result of a surge in the Government Refinance Index as pre-June 2009 borrowers took advantage of a drop in mortgage insurance premiums on streamlined refinances that became effective June 11. Also, as a percent of total application activity, refinance share slipped to 79% from 81% previously.

"Refinance volume fell last week due largely to a fall-off in refinance applications for government loans, which had more than doubled the prior week," said Michael Fratantoni, Mortgage Bankers Association (MBA) vice president of research and economics.

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