Trump orders to buy $200 billion in mortgage bonds to reduce burdens

Washington.- U.S. President Donald Trump said Thursday that he ordered the purchase of mortgage bonds worth $200 billion in an attempt to reduce the monthly rates and fees that Americans must pay when acquiring a property. “Because I decided not to sell Fannie Mae and Freddie Mac during my first term, they are now worth many times that amount — a true fortune — and have $200 billion in cash, therefore, I am instructing my representatives to buy $200 billion in mortgage bonds,” Trump wrote on his Truth Social network.

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Fannie Mae and Freddie Mac are two of the main companies sponsored by the U.S. Government that stabilize the national real estate market by buying mortgages from banks.

The effect Trump expects with mortgage bonds

Trump assured that the measure he says he has ordered will “reduce mortgage rates, monthly payments and make the cost of homeownership more affordable.”

Traditionally, the Federal Reserve has been the largest buyer of mortgage-backed securities and in general when the Fed or another entity such as the government-sponsored enterprises State buy significant volumes of mortgage-backed assets, particularly mortgage bonds, interest rates on loans to acquire real estate are reduced.

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On several occasions, most recently last year, Trump has proposed plans to privatize Fannie Mae and Freddie Mac, primarily through large initial public offerings (IPOs).