Trump’s order for Freddie, Fannie to buy $200 billion mortgage bonds raises IPO doubts

Trump’s directive for Fannie Mae and Freddie Mac to buy up to $200 billion of mortgage‑backed securities is intended to push mortgage rates and monthly payments lower, but it also makes a near‑term IPO or full privatization of the two firms less likely in the eyes of many analysts.​

What Trump ordered

• President Donald Trump announced that Fannie Mae and Freddie Mac are to purchase as much as $200 billion in mortgage bonds or mortgage‑backed securities (MBS).​

• The goal is to act as a large buyer in the MBS market to drive down long‑term mortgage rates and improve housing affordability ahead of political milestones such as the 2026 midterm elections.​

Immediate market and mortgage impact

• Expectations of large‑scale buying by Fannie and Freddie have boosted mortgage‑bond prices and helped pull average mortgage rates below roughly 6%, improving the window for some homebuyers.​

• The move effectively uses the government‑controlled firms as a policy lever similar to quantitative easing, asserting more direct presidential influence over credit conditions rather than relying solely on the Federal Reserve.​

Why this raises IPO doubts

• Fannie Mae and Freddie Mac remain under government conservatorship from the 2008 crisis, and there had been renewed discussion of taking them public again via an IPO or partial stock offering, with FHFA Director Bill Pulte saying Trump would decide within “a month or two.”​

• Analysts argue that using them as a “funding arm for presidential policy” signals they are still tools of public policy, which undermines the case that they are ready to operate as fully independent, profit‑driven public companies after an IPO.​

Analyst and investor reactions

• Market strategists note that Trump’s praise for not selling or IPO‑ing the companies in his first term, combined with this new directive, “does not sound like a president who is in a rush to IPO the enterprises.”​

• Others warn that re‑casting Fannie and Freddie as massive bond buyers risks “repeating history,” recalling that aggressive MBS accumulation contributed to their near‑failure before the 2008 bailout.​

What it means going forward

• For now, the order supports lower mortgage rates and may buoy Fannie and Freddie’s securities and existing shares, but at the cost of reinforcing political control and policy risk around the companies.​

• Several prominent investors and analysts now see a public offering or exit from conservatorship as less feasible in the short term, even though the administration is still formally weighing IPO options.​