A Behind-the-Scenes Change That Could Help Mortgage Rates

If you’ve been watching mortgage rates and the housing market, you may have heard that Fannie Mae and Freddie Mac are holding onto more home loans recently — and that can actually be good news for buyers and sellers alike. Here’s what that means in real terms for you.

Who Are Fannie Mae and Freddie Mac?
Fannie Mae and Freddie Mac are government-sponsored enterprises that help make mortgages more affordable and accessible. They don’t lend directly to homebuyers — instead, they buy loans from banks and lenders, which gives those lenders more money to make new loans. That’s part of what keeps mortgage rates lower and the market flowing more smoothly. 

What’s Changing?
Lately, both Fannie and Freddie have increased the amount of loans and mortgage-backed securities they keep in their own portfolios instead of selling them off to investors. In fact, in just a few months, they’ve expanded those holdings by more than 25% — the highest level in years.

Why It Matters to You
When Fannie and Freddie hold more loans:

• It reduces the supply of mortgages for sale in the broader market.
• That increased demand for loans and mortgage-backed securities can push mortgage rates lower because investors are willing to accept smaller returns.
• Lower mortgage rates can make buying a home more affordable and help existing homeowners who are thinking about refinancing.

In 2025, we’ve already seen mortgage rates trend downward from earlier in the year — and many experts connect that trend to the increased demand driven by Fannie and Freddie holding more loans.

What This Isn’t
This shift doesn’t necessarily mean radical policy changes or major government takeovers of the mortgage market. Fannie and Freddie remain under federal oversight, and any big structural changes — like privatization or new legislation — would take time and political action. But right now, the focus is on using their resources to help stabilize and support the housing market.

How It Affects You
For buyers, lower rates may mean more purchasing power or more affordable monthly payments. For sellers, a more active mortgage market can support demand from qualified buyers. And for homeowners thinking about refinancing, it could be a chance to secure a better rate if the trend continues.

Fannie Mae and Freddie Mac holding more loans is contributing to mortgage market activity in a way that can help keep rates competitive — and that’s worth paying attention to if you’re planning a move in the coming months. If you have been considering buying or selling in 2026 give our team a call to discuss what this could mean for your real estate process!

To learn more about the impact of Fannie Mae and Freddie Mac’s increase in loan holdings you can take a look at this article from Homes.com.