Are 5% mortgage rates history?

The Fed has promised to continue to buy mortgage backed securities until April 1 of this year. Many are speculating that interest rates are going to rise considerably once the free market adapts to the new risk and the government has stepped out of the picture. While it is more than likely that the lenders will raise interest rates to cover this new risk, rates will more than likely not rise very much. Rising rates will push an already shifty housing market even lower to make up for the rise in interest rates. With stated-income loans and other risky loan programs almost completely extinct, people are starting to take a more realistic approach as to what they can and can't afford in a home. Even if they would like to get in over their head, the underwriting department at almost any lender will help them change their mind. If interest rates do rise, housing prices will adjust as well.