CHLA Applauds Fannie Mae, Freddie Mac For Mortgage Purchases To Bring Down Mortgage Rates

The Community Home Lenders of America (CHLA) is applauding reports showing that Fannie Mae and Freddie Mac are doing their part to help bring down mortgage rates by increasing their mortgage portfolios to support market liquidity.

“Young families need all the help they can get today to buy their first home, but the too-high mortgage-to-Treasury spread is hurting them,’ said Rob Zimmer, head of external affairs for CHLA.  “CHLA has long argued the GSEs can help such families, in a safe and sound manner, by increasing liquidity for GSE mortgages.”

For two years, CHLA has called on Treasury and FHFA to allow the GSEs expanded retained portfolios when the mortgage-to-Treasury (30/10) spread is above 170 basis points.  This would signal other MBS buyers to come in and help reduce mortgage costs for young families looking to buy their first home.  The 30/10 spread has been abnormally high since the Federal Reserve suspended its MBS purchase program in 2022.

While this spread has declined this year, it remains elevated at 215 basis points, well above an historic norm of 140-170 basis points.  This is why CHLA and the Independent Community Bankers of America recommended the GSEs have authority to increase their purchases of GSE and Ginnie Mae MBS while 30/10 spreads remain above 170 bps.

CHLA notes that GSEs are headed in the right direction, for the right reasons.  According to September monthly summaries of both GSEs, the retained portfolios have grown from $170.7B in February 2025 to $215.2B as of September 30th.

And, on its 3rd quarter earnings call, the Fannie Mae Chief Financial Officer said that “The lender liquidity portfolio has increased in each of the last two quarters as assets from the liquidity portfolio were invested in MBS to support market liquidity.”

Notably, this has also increased GSE earnings.

CHLA commends Treasury Secretary Scott Bessent and FHFA Director Bill Pulte for allowing Fannie Mae and Freddie Mac to better fulfill their missions by safely and soundly supporting the mortgage market through expanded retained portfolios, parts of which invest in Mortgage-Backed Securities (MBS).