FHFA ramps up mortgage-backed securities purchases as Pulte signals aggressive housing push

The Federal Housing Finance Agency is scaling up its mortgage-backed securities purchases, according to FHFA Director Bill Pulte. The move represents one of the most aggressive interventions in the US housing market since the 2008 financial crisis, with the government-sponsored enterprises Fannie Mae and Freddie Mac deploying their own capital to buy up mortgage bonds at a pace not seen in years.

The broader goal is ambitious: $200 billion in total MBS purchases, directed by President Trump on January 8, 2026. An initial $3 billion tranche was executed that same day, funded by the GSEs’ existing liquidity rather than new government appropriations.

The mechanics of a $200 billion bet on housing

The FHFA authorized each GSE to hold up to $225 billion in mortgage bonds as of January 2026. That’s a massive expansion of their purchasing capacity, giving Fannie Mae and Freddie Mac room to respond to market conditions in real time.

By the end of January, the two entities had collectively added $12.5 billion in MBS to their portfolios. The result was a modest but meaningful decline in mortgage rates, which eased toward 5.95%, a welcome reprieve from the nearly 8% levels that plagued borrowers in 2024.

Analysts have projected that the full purchasing program could shave 10 to 25 basis points off 30-year mortgage rates. A quarter-point reduction might sound small, but on a $400,000 loan over 30 years, it translates to thousands of dollars in savings.

Filling the Fed-shaped hole in the market

The Federal Reserve has been steadily unwinding its roughly $2 trillion MBS portfolio, letting approximately $15 billion in bonds roll off its balance sheet each month. The FHFA’s purchases are designed to offset that runoff, essentially stepping in as a replacement buyer.

This represents a sharp philosophical reversal for the GSEs. Since being placed into conservatorship during the 2008 financial crisis, their retained portfolios have been deliberately shrunk. At their peak, Fannie Mae and Freddie Mac held combined portfolios of around $1.5 trillion. By late 2022, that figure had been whittled down to roughly $158 billion.

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