Mortgage rates are likely to rise under any plan that would overhaul Fannie and Freddie. Lawmakers face a key dilemma: requiring successors to Fannie and Freddie to hold more capital could reduce the risk of future taxpayer losses, but would also raise borrowing costs. The Senate bill would require successors to maintain a 10% capital cushion. Fannie estimates that would cause rates to rise by around 0.5 and 1 percentage points from current levels, though borrowers with weaker credit could see rates rise by more than 3 percentage points. Freddie estimates rates will rise by 0.1 and 0.6 percentage points. Because any overhaul would be phased in over many years, borrowers wouldn’t see an immediate price spike.