Trump's Mortgage Bond Buying Plan Could Move Rates, But How Much and When?

Over the past few days, several financial news outlets have reported on a proposal that could influence mortgage rates: the federal government may direct Fannie Mae and Freddie Mac to purchase up to $200 billion in mortgage-backed securities (MBS). The idea? Increasing demand for mortgage bonds to push prices up and long-term interest rates down.

Why This Matters

When Fannie and Freddie buy mortgage bonds, that increases demand in the market. Higher demand typically:

📌 raises bond prices
📌 lowers yields
📌 pulls mortgage interest rates lower

This can benefit would-be homebuyers and refinance candidates by making loans more affordable.

The Big Questions: How Much and When

Here’s the reality: even if this plan goes forward, there are two major unknowns:

1. Magnitude of Rate Improvement
   Markets react based on expectations. We don’t yet know if this plan will move rates a quarter point, half point, or even more. Early estimates are speculative, and past policy efforts have shown that results can vary widely.

2. Timing of the Impact
   Policy proposals take time to implement, and even longer to show measurable effects in mortgage markets. We could be weeks or months out before we see real movement.

So, while this news might be good for rates, there’s no guarantee on the size or timing of the drop.

What You Should Do Now

Instead of just waiting and hoping for a better rate…

👉 Get a Strike Rate with your loan officer.

What’s a Strike Rate?
A Strike Rate is the target mortgage interest rate you define with your loan officer — the rate that gives you the monthly payment and total savings you want. Once rates hit your strike, we lock and protect your pricing.

Why this matters:

✔ It gives you a clear plan instead of guessing.
✔ It prevents moving the goal post because “maybe rates go lower.”
✔ It protects you if rates suddenly move back up.

Waiting for the lowest possible number is often costly. Smart timing, preparation, and a defined target help you make the move when it makes sense for your financial goals.

Bottom Line

Yes, news about Fannie and Freddie might be good for rates. But the impact is still uncertain. The smartest position you can take is to work with your loan officer to define a Strike Rate that aligns with your goals, and be ready to pull the trigger when the market meets it.

Reach out today, to let Team Chedester help you find your strike rate or answer any questions.