10. Fannie and Freddie's future: A wild card in the outlook for mortgage rates is the administration's plans for Fannie and Freddie. The two mortgage finance giants—which buy home loans from banks—are a key source of liquidity for the market. The government-chartered companies have long been controversial, and speculation about their future has been mounting since their shaky finances forced Uncle Sam to take over last year. The administration's plans for their future—which could include liquidation or converting them to public utilities—could become clearer in early 2010. This decision could have profound implications for mortgage rates, Gumbinger says. "We could have some dislocations in the supply chains with mortgages depending upon how immediate or how gradual the changes to the structures of those companies are," he says.