2026 Mortgage Rates May Drop Because of This Trump Proposal — Will It Help You Buy a House?
Written by
Travis Woods
Edited by
Zuri Anderson
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American mortgage rates continue to lessen in the early weeks of 2026, offering a potentially hopeful year of potential home buying.
After rates peaked above 7% in 2025, the average 30-year fixed mortgage rate has currently settled just above 6% — a near-historic low. In addition to mortgage rates trending downward, President Donald Trump has initiated a bold proposal that may lower mortgage rates even further.
What Is Trump’s Plan To Lower Mortgage Rates?
In what Yahoo Finance is calling a “wild card” move, the Trump administration has directed Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation) to purchase as much as $200 billion in mortgage bonds as a means to tighten mortgage spreads and thereby lower borrowing costs.
Buying these securities in such large quantities could, in theory, reduce the yield that investors demand — which would, in turn, press lenders to offer lower mortgage rates to borrowers. Lower mortgage rates would then, most likely, make it far easier to afford buying a new home.
That said, the impact of such a “wild card” move by Fannie Mae and Freddie Mac is not yet fully known. It’s possible that the overall result will be a rather modest one, unless the purchases are sustained over time in order to shift broader market expectations. The act of tightening mortgage spreads has historically only lessened mortgage costs on an incremental level, with long-term rates still relying upon Treasury yields and inflation.
Bottom line? Don’t expect a dramatic nosedive in mortgage rates, as housing affordability is also predicated upon a number of variables, like local market conditions and home prices. That said, Trump’s bond-buying “wild car” move will likely drop rates at a modest level at minimum, and that may be just the financial advantage you need to purchase a home in 2026.
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