According to the Mortgage Banker's Association, demand for mortgages decreased last week - mostly due to a lack of refinancing activity. Many analysts see this decrease in refinancing as a result of the increasing 30 year mortgage rate, which again went higher last week.

The average 30 year mortgage rate hit 6.42 percent, while 1-Year ARM's fell to 5.64 percent.

Still, higher rates didn't have much of an effect on new mortgages.

"Seasonal factors are rising and we are entering the peak home buying season of spring, which is probably why higher rates did not have a larger impact on loan demand," said Douglas Duncan, chief economist at the MBA.