Positive economic news fueled the fifth consecutive week of rising mortgage rates, according to surveys conducted by Freddie Mac and Bankrate.com.

In Freddie Mac’s survey, the 30-year fixed-rate mortgage averaged 5.82 percent for the week ended today, up from last week when it averaged 5.77 percent. The average for the 15-year fixed-rate mortgage this week is 5.38 percent, up from last week when it averaged 5.34 percent. Points on both the 30- and 15-year averaged 0.6.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.3 percent this week, with an average 0.7 point, up slightly from last week when it averaged 5.27 percent. The one-year Treasury-indexed ARM averaged 4.47 percent this week, with an average 0.7 point, up from last week when it averaged 4.46 percent.

“Long-term mortgage rates will more than likely rise over the next few months, albeit modestly compared to shorter-term rates,” said Frank Nothaft, vice president and chief economist at Freddie Mac. “As the Federal Reserve (Fed) increases its targeted overnight-lending rate, home-equity loans will become more costly. This is because many home-equity loans are tied to the prime rate, which generally follows every Fed rate hike. Currently, the prime rate is 6.25 percent and is expected by many to rise to 6.5 percent next week.”

Nothaft added, “Homeowners wanting to tap into recent gains in home values have turned to a refinancing option, whereby they can extract a portion of the home equity they built over the years. Just in the second quarter of 2005, approximately 74 percent of refinancing comprised of homeowners taking out a new loan balance of 5 percent or more, most of which had an interest rate below today’s prime rate.”

In Bankrate.com’s survey, mortgage rates increased for the fifth consecutive week and are now the highest since the week of April 13. The average 30-year fixed-rate mortgage climbed from 5.84 percent to 5.91 percent, according to Bankrate.com. The 30-year fixed-rate mortgages in this week’s survey had an average of 0.37 discount and origination points.

The average rate for the jumbo 30-year fixed-rate mortgage increased at a similar pace, rising from 6.03 percent to 6.1 percent. The 15-year fixed-rate mortgage popular for refinancing jumped from 5.45 percent to 5.51 percent. Adjustable-rate mortgages were up at a more modest pace, with the average 5/1 adjustable-rate mortgage nudging higher from 5.49 percent to 5.51 percent, and the one-year ARM rising to 4.82 percent from 4.8 percent one week ago.

Solid second-quarter economic growth and encouraging news in the manufacturing sector propelled yields on 10-year Treasury notes higher. Mortgage rates are closely related to yields on long-term government bonds. Positive news on the economy is resonating with bond investors, particularly with the Federal Open Market Committee poised to raise interest rates for a 10th consecutive time. The Fed is widely expected to raise short-term interest rates by one-quarter percentage point on Aug. 9. The Fed’s hints at continued interest-rate hikes, despite the low levels of long-term interest rates, are also helping to quietly push rates higher.

The following is a sampling of Bankrate’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas.

New York – 5.91 percent with 0.16 point

Los Angeles – 5.97 percent with 0.56 point

Chicago – 6.01 percent with no points

San Francisco – 5.97 percent with 0.33 point

Philadelphia – 5.84 percent with 0.38 point

Detroit – 5.91 percent with 0.25 point

Boston – 6.01 percent with 0.1 point

Houston – 5.84 percent with 0.76 point

Dallas – 5.9 percent with 0.57 point

Washington, D.C. – 5.8 percent with 0.6 point

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