Refinancing activity increased just slightly in the week ending Feb. 10 as mortgage rates ticked up. 

According to the Mortgage Bankers Association (MBA), the Refinance Index rose 0.8% to ~4537, its fifth straight week above 4000 and highest level since 2011's high of 4867 in mid-August. As a percent of total applications, refinancing share rose to 81.1% from 80.5% in the previous week.

Meanwhile, the Purchase Index fell 8.4% to 166.6 — its lowest level since the end of 2011.  Overall, mortgage application activity decreased 1% last week. 

The MBA also reported that the 30-year fixed mortgage rate for conforming loans was at 4.08% versus 4.05% previously with points slightly higher as well. FHA rates, however, were two basis points lower to 3.87%.

Capacity constraints at mortgage lenders are a hindrance to refinancing activity which could keep refinance activity relatively sticky. This is demonstrated in the wide primary/secondary mortgage rates which JPMorgan Securities analysts think will remain wide.

In addition to the constraints issue, they think the higher g-fee and higher capital requirements for banks will shift the primary/secondary spread "permanently higher."

Morgan Stanley analysts suggested in research as well that with demand increasing from higher quality refinancers due to mortgage rate levels, it is likely that many lenders are not in a position to dedicate as much capacity to Home Affordable Refinance Program or HARP refinancing. 

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