Trump Proposes Releasing Mortgage-Backers Fannie Mae, Freddie Mac

President Donald Trump said he is considering making a big change to the housing market that could impact how much it costs to get a mortgage.

In a Thursday evening Truth Social post, Trump said he was considering taking mortgage finance firms Fannie Mae and Freddie Mac public after they had been under government control since the 2008 financial crisis.

“I am giving very serious consideration to bringing Fannie Mae and Freddie Mac public,” Trump said in his post. “Fannie Mae and Freddie Mac are doing very well, throwing off a lot of CASH, and the time would seem to be right.”

While Fannie Mae and Freddie Mac are publicly traded on over-the-counter markets, the U.S. Treasury controls a majority of the companies’ ownership. While Trump’s post did not have many details, he is likely referring to the idea that the government divest its ownership stake, with the two companies re-entering the stock market through an initial public offering (IPO).

Fannie, Freddie Spin-Off Comes With Risks

Fannie Mae and Freddie Mac don’t issue loans to homebuyers, but they support the housing market by buying mortgages from banks and other lenders. This helps keep cash flowing into the housing market and supports financial institutions’ abilities to issue more housing loans.

During the 2008 financial crisis, the government placed these two entities into a “conservatorship,” providing a bailout to the organizations while also giving the Federal Housing Finance Agency (FHFA) more leeway to operate the lenders.

Trump said he would speak with Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and FHFA Director William Pulte about the decision. Pulte has said that he would support releasing Fannie and Freddie from government control. In contrast, Bessent said in a February interview that he would evaluate the decision on how it would affect mortgage rates.

Some worry that mortgage rates could rise if Fannie and Freddie are returned to the private sector.  Moody’s Chief Economist Mark Zandi told CNN in 2024 that costs for borrowers could increase by $1,800 to $2,800 if the transition isn’t handled properly.

However, relinquishing government control of Fannie and Freddie could be a windfall for the U.S. government, which could realize around $300 billion in profit from the deal, according to Pershing Square CEO Bill Ackman, who supports the move. Ackman’s Pershing Square portfolio includes Fannie Mae and Freddie Mac common stock and he has argued that the companies are now adequately capitalized to return to private ownership.