It’s no secret that the economy could be doing better. And the Trump administration is acting.
Because the White House announced a $200 billion gift to Americans.
Trump’s Bold Plan to Slash Mortgage Rates
President Donald Trump has unveiled an innovative strategy to tackle soaring housing costs by directing the purchase of $200 billion in mortgage bonds, a move that leverages his first-term decision to retain government control over Fannie Mae and Freddie Mac.
In a Truth Social post, Trump explained, “Because I chose not to sell Fannie Mae and Freddie Mac in my First Term, a truly great decision, and against the advice of the ‘experts,’ it is now worth many times that amount — AN ABSOLUTE FORTUNE — and has $200 BILLION DOLLARS IN CASH.”
He continued, “Because of this, I am instructing my Representatives to BUY $200 BILLION DOLLARS IN MORTGAGE BONDS. This will drive Mortgage Rates DOWN, monthly payments DOWN, and make the cost of owning a home more affordable.”
Driving Down Costs Through Strategic Bond Purchases
The plan involves Fannie Mae and Freddie Mac utilizing their substantial cash reserves to acquire mortgage-backed securities, a mechanism economists note can lower interest rates by increasing demand.
Trump emphasized the direct benefits, stating, “This will drive Mortgage Rates DOWN, monthly payments DOWN, and make the cost of owning a home more affordable.”
Federal Housing Finance Agency Director Bill Pulte confirmed the approach on X, aligning with Trump’s vision to ease the housing crunch amid rates hovering around 6.2% and home sales at historic lows.
Housing-related stocks surged in response, with mortgage lenders like Rocket Cos and UWM Holdings jumping around 6%, reflecting market confidence in Trump’s ability to deliver tangible relief.
Broader Push for Housing Affordability and Fed Reform
Trump tied the initiative to additional measures prioritizing everyday Americans, announcing, “It is for that reason, and much more, that I am immediately taking steps to ban large institutional investors from buying more single-family homes, and I will be calling on Congress to codify it. People live in homes, not corporations.”
He plans to elaborate on further proposals at his upcoming Davos speech.
Additionally, Trump criticized Federal Reserve Chair Jerome Powell, saying, “Could somebody please inform Jerome ‘Too Late’ Powell that he is hurting the Housing Industry, very badly? People can’t get a Mortgage because of him. There is no Inflation, and every sign is pointing to a major Rate Cut.” With Powell’s term ending in May, this underscores Trump’s commitment to aggressive rate reductions and policies that put homeownership within reach again.
