The Reason Mortgage Rates Could Skyrocket

Mortgage rates have jumped higher over the past year, but they still sit at historical lows. However, that may not be the case for much longer.

Politicians on Capitol Hill, both Republicans and Democrats, are discussing a bill that would reduce the government's participation in the housing market. While many agree this would be wonderful news for the U.S. taxpayer, it may not be so for American homebuyers. The government's deep involvement leads to lower interest rates for potential borrowers, and rates could jump higher with less government support.

In this segment from The Motley Fool's financials-focused show Where the Money Is, Fool banking analysts Matt Koppenheffer and David Hanson turn once again to the Twittersphere, this time to discuss why mortgage rates may soon skyrocket. They look at a tweet from @NickTimiraos, and discuss just how big of an impact on mortgage rates the overhaul of Fannie Mae (NASDAQOTCBB: FNMA  ) and Freddie Mac (NASDAQOTCBB: FMCC  ) could have.

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