Trump Orders $200 Billion Mortgage Bond Purchase to Lower Rates

President Donald TRUMP has directed Fannie Mae and Freddie Mac to purchase up to $200 billion in mortgage bonds, a move intended to reduce borrowing costs for homebuyers. The announcement, made via Trump's Truth Social platform, triggered an immediate market response, with 30-year mortgage rates dropping near 6%—their lowest level since early 2023.

The initiative aims to alleviate affordability pressures in the housing market, where high rates have sidelined potential buyers. Federal Housing Finance Agency Director William Pulte confirmed the government-sponsored enterprises WOULD execute the purchases, though the impact remains uncertain given the $11 trillion scale of the mortgage bond market.

Lower mortgage rates could stimulate housing demand, influence consumer spending patterns, and Ripple through broader economic growth. The policy leverages Fannie and Freddie's role as dominant purchasers of mortgages, which lenders typically sell to the entities before bundling into securities.