FHFA's Pulte says agency will buy even more mortgage-backed securities
Pulte says the housing finance agency is stepping up purchases of mortgage bonds, extending a policy already in place.
Published
Chart: MBB, one-minute prices, three sessions
The Federal Housing Finance Agency will buy mortgage-backed securities in larger amounts, according to its director, Bill Pulte.
Pulte gave no dollar figure for the increase. In January, proposals surfaced for Fannie Mae and Freddie Mac to buy up to $200 billion in mortgage-backed securities, following instructions attributed to President Trump, according to Scotsman Guide. The two companies, which operate under FHFA conservatorship, are capped at holding $225 billion each in such securities, but held a combined $247 billion as of November, the Wall Street Journal reported, as cited by Scotsman Guide.
Fannie Mae and Freddie Mac have already been buying mortgage-backed securities under Pulte's direction as a way to push down mortgage rates, National Mortgage News reported, with officials also weighing cuts to loan-level pricing fees. Past efforts by housing agencies to lower borrowing costs through such purchases have had limited effect when Treasury yields rose, according to Briefs.co.
The larger purchases extend a policy already underway rather than mark a shift in market conditions. Home price growth has already slowed to flat month over month, and the bigger purchases may offer some support for mortgage availability, but they do not signal new urgency or added confidence about the direction of the housing market.