HousingWire Daily Fannie and Freddie to buy $200B in MBS to lower mortgage rates
Jan 9, 2026
Logan Mohtashami, a lead analyst specializing in mortgage and housing trends, joins to discuss the recent directive from Trump for Fannie and Freddie to buy $200B in mortgage-backed securities. He explains how this move aims to lower mortgage rates and its limited effects compared to quantitative easing. Logan connects the timing to midterm politics, suggesting it's a defensive strategy to prevent rising rates. They also delve into the potential improvements in spreads and overall market sentiment, providing insights into housing demand.
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GSE Bond Buys Aim To Cap Rates
- Directing Fannie and Freddie to buy $200B in MBS is meant to tighten spreads and help keep mortgage rates lower.
- Logan Mohtashami frames this as targeted insurance, not large-scale QE, that limits upside rate spikes into the midterms.
Double Whammy For Lower Mortgage Rates
- Improved spreads plus lower 10-year yields create a 'double whammy' that can push mortgage rates below 6%.
- Mohtashami cautions that getting below ~5.75% requires spreads to normalize to 20–40 bps.
Temporary Market Support Into 2026
- The buy program mostly acts to prevent spreads from widening further and to keep rates lower for longer into 2026.
- Mohtashami expects this to be a 2026 story and not necessarily repeated annually.