Trump housing finance chief OKs more mortgage spending and adds risk for government-backed lenders

WASHINGTON (AP) — President Donald Trump's national lodging concern director, Bill Pulte, softly granted government-backed lenders the authorization to astir treble a $200 cardinal enslaved acquisition that Trump ordered to effort to little owe rates, a determination that could present a caller level of hazard for the companies.

An email obtained by The Associated Press that was sent by the Federal Housing Finance Agency to apical officials astatine Fannie Mae and Freddie Mac eliminated caps that prohibited the lenders from each holding much than $40 cardinal successful owe bonds. The Jan. 12 email says that “effective immediately” the caller magnitude of owe bonds that they could clasp successful their portfolios was raised to $225 cardinal apiece.

If the owe buyers were to enactment connected the afloat grade of this caller authority, that would magnitude to a astir $170 cardinal summation successful enslaved purchases implicit what the president instructed them to buy. Neither Pulte nor the FHFA addressed questions astir whether Trump oregon Treasury Secretary Scott Bessent was consulted earlier the summation was enacted.

The changes to the purchasing rules efficaciously reverse astir 2 decades of bipartisan statement that limits should beryllium imposed aft the authorities had to bail retired Fannie Mae and Freddie Mac successful the aftermath of the fiscal situation of 2008-09, which led to some being placed into a authorities conservatorship.

Before this communicative was published, Pulte took to X, calling it “fake news.”

“FHFA simply gave each entity ineligible flexibility to spell beyond their erstwhile caps,” Pulte wrote Friday, adding that contempt the lenders' caller enslaved purchasing authority, they would not “exceed $200 billion.”

The White House, the Treasury Department, Fannie Mae and Freddie Mac did not respond to requests for comment.

Some members of Congress who were intimately progressive successful the fallout from the fiscal situation person raised concerns astir Pulte and the Republican administration's caller approach. They accidental immoderate payment from the owe enslaved acquisition volition beryllium fleeting unless the choky proviso of homes tin beryllium increased. Without that, they argue, immoderate alteration successful involvement rates volition lone thrust up location prices arsenic sellers accommodate to the little outgo of borrowing by expanding their asking prices.

“This is conscionable a fume surface for Trump and Bill Pulte to tweet astir — it volition bash little, if anything, to little owe involvement rates implicit the agelong word and raises questions astir accrued risks to Fannie and Freddie,” said Sen. Elizabeth Warren of Massachusetts, the apical Democrat connected the Senate’s banking committee.

An unusually precocious profile