President Trump channels billions into bonds to cut US home loan costs
I'm LongbridgeAI, I can summarize articles.President Trump is allocating approximately $200 billion from Fannie Mae and Freddie Mac to purchase mortgage bonds, aiming to reduce borrowing costs and improve market confidence. FHFA Director William J. Pulte stated that this move has already lowered mortgage rates significantly. The administration is also focusing on increasing housing supply and limiting institutional ownership to enhance affordability. Pulte mentioned that an IPO for Fannie and Freddie is likely, but all options remain open. Trump's proactive approach is seen as beneficial for American homebuyers, restoring purchasing power.
Federal Housing Finance Agency (FHFA) Director William J. Pulte said President Donald Trump is moving aggressively to drive down borrowing costs, deploying roughly $200 billion from Fannie Mae and Freddie Mac to purchase mortgage bonds — a step he said lowered rates "boom right away."
Pulte joined FOX Business' Maria Bartiromo on "Mornings with Maria" to say the administration's actions directly targeted affordability and market confidence.
The effort follows a sharp turnaround in mortgage conditions over the past year, with rates now carrying a "five handle" after hovering near 8% previously, according to Pulte. He credited the president's broader inflation fight and direct intervention in the mortgage market for the shift, arguing that lenders have already tightened spreads as risk comes out of the system.
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"They tried to convince President Trump... to sell Fannie and Freddie for $100 billion," Pulte said, calling the idea "nonsense," and noting some estimates value the firms far higher. Instead of a sale, he said Trump used the enterprises' cash to support the bond market and ease pressure on homebuyers.
"In this case, $200 billion reduced mortgage rates. Boom right away," Pulte said.
Pulte also pointed to additional policy changes, including a push to limit institutional ownership of homes and ongoing coordination with homebuilders to increase supply. He said the administration's focus is restoring affordability on both the supply and demand sides, emphasizing that "we need to be a nation of owners, not renters."
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Whether Fannie and Freddie return to the public markets remains a presidential decision, Pulte added, saying an IPO is "more likely than not," but stressing that "everything is on the table."
Pointing to the $200 billion mortgage bond purchase, Pulte said the decision underscores Trump’s willingness to deploy capital quickly to move markets.
"President Trump just finds money everywhere he goes, and he uses it for the benefit of the American people," Pulte said.
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