Mortgage interest rates remained flat during the week ended August 7 according to the weekly Primary Mortgage Market Survey released by Freddie Mac.

The 30-year fixed-rate mortgage (FRM) averaged 6.5 percent with 0.7 point, unchanged from the previous week.

The 15-year FRM averaged 6.10 percent, up 3 basis points from one week earlier. Fees and point increased from 0.6 point to 0.7 point.

Short-term rates also remained relatively unchanged. The five-year Treasury-indexed hybrid adjustable rate mortgage moved from 6.05 percent from an average 6.07 percent. Fees and points were static at 0.6 point.

The one-year Treasury-indexed ARM averaged 5.22 percent compared to 5.27 percent a week earlier. Fees and points averaged 0.6 both weeks.

"The housing market is continuing to act as a drag on the economy," said Frank Nothaft, Freddie Mac vice president and chief economist. "Residential fixed investment subtracted 0.6 percentage points off second quarter growth in real GDP.

"More recently, mortgage applications for home purchases in the past few weeks fell to the slowest pace since the week ending February 21, 2003, according to the Mortgage Bankers Association. Finally, although showing some initial signs of improvement, the inventory of unsold homes remains at historically high levels."

The Mortgage Bankers Association (MBA) in results from its Weekly Mortgage Applications Survey reported substantially more movement in long term loans but the single ARM it tracks was virtually unchanged.

The average rate for 30-year FRMs increased to 6.57 percent from 6.41 percent with points, including the origination fee nudging up from 1.13 to 1.14.

The 15-year FRM rate increased to 6.17 percent from 6.02 percent while points increased to 1.06 from 1.02.

The average contract interest rate for one-year ARMs decreased to 7.15 percent from 7.17 percent, with points increasing to 0.38 from 0.36.

Mortgage applications were down 1.5 percent on a seasonally adjusted basis from the previous week and 2.2 percent unadjusted. The volume was down 36.9 percent from the same week in 2007.

Refinancing as a share of all applications decrease to 35.2 percent from 35.9 percent a week earlier and the market share of ARMs increased slightly to 7.3 percent from 6.9 percent the previous week.