Why Did the Debt Crisis Affect Mortgage Rates If It Didn’t Actually Happen?

Why Did the Debt Crisis Affect Mortgage Rates If It Didn’t Actually Happen?

Economists predicted that a government default would cause interest rates to rise because it would hurt the creditworthiness of the United States and increase the treasury’s cost of borrowing money. Since the interest rates on consumer loans are tied to the treasury rate, a default would cause all interest rates to rise, including mortgages.

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