Privatization of Fannie Mae and Freddie Mac is an objective for the administration following recent tax and trade deals. Treasury Secretary Scott Bessent indicated that significant studies are ongoing to ensure mortgage spreads do not widen post-privatization. Concerns among housing stakeholders focus on potential upward pressure on mortgage rates due to increased capital requirements for Fannie Mae and Freddie Mac. The importance of not adversely affecting mortgage rates is emphasized by both Bessent and FHFA director Bill Pulte, as they monitor metrics related to mortgage rates closely.
"It [privatization of Fannie and Freddie] is a goal for this administration," Treasury Secretary Scott Bessent said in May. "Again, we're doing peace deals, tax deals, and trade deals."
"One reason housing stakeholders should pay attention to the fate of Freddie Mac and Fannie Mae is the long standing concern that ending conservatorship could put upward pressure on mortgage rates."
"The priority for a Fannie and Freddie release, the most important metric that I'm looking at is any study or hint that mortgage rates could rise."
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