Sen. Elizabeth Warren of Massachusetts, Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, has sent a letter to Scott Bessent, Secretary of the U.S. Department of the Treasury, requesting information on the Trump administration’s plans to reprivatize Fannie Mae and Freddie Mac.
“The Treasury Department will play a critical role in any reprivatization efforts as the arbiter of the Senior Preferred Stock Purchase Agreements (PSPAs), which safeguards taxpayers’ financial interests in the Enterprises,” said Sen. Warren in the letter. “It is our understanding that this month, the Department of the Treasury began hosting roundtable meetings with cross-industry stakeholders regarding housing finance and the role of the Enterprises. It is imperative that an impact assessment of reprivatization be conducted before any plan is established on reprivatization.”
On May 27, President Trump took to social media platform Truth Social, stating: “Our great Mortgage Agencies, Fannie Mae and Freddie Mac, provide a vital service to our Nation by helping hardworking Americans reach the American Dream—Home Ownership. I am working on TAKING THESE AMAZING COMPANIES PUBLIC, but I want to be clear, the U.S. Government will keep its implicit GUARANTEES, and I will stay strong in my position on overseeing them as President. These Agencies are now doing very well, and will help us to, MAKE AMERICA GREAT AGAIN!”
Fannie Mae and Freddie Mac help provide stability and affordability to America’s home mortgage market. The National Association of Realtors (NAR) reports that Fannie and Freddie support approximately 70% of the U.S. mortgage market. Government-backed mortgages are loans obtained through private lenders, but are insured by one of three federal government agencies: the Federal Housing Administration (FHA), the U.S. Department of Agriculture (USDA), or the U.S. Department of Veterans Affairs (VA).
“Despite the enormous implications for the housing market and taxpayer interest, this reported effort raises questions about which agency will lead the reprivatization process, what the goals of reported reprivatization are, and how the American people’s interests will be protected,” wrote Sen. Warren. “Given the state of the nation’s housing crisis, it is prudent to have these discussions outside of the shadows and involve Congress, as the body that is ultimately responsible for implementing necessary changes to the Housing and Economic Recovery Act of 2008, the Safety and Soundness Act of 1992, and other laws that govern the oversight and regulation of the Enterprises.”
On September 6, 2008, with consent of both Fannie Mae’s and Freddie Mac’s Boards of Directors, the Director of the Federal Housing Finance Agency (FHFA) exercised statutory authority to place each GSE into conservatorship. This move, originally intended as a temporary move, established the two conservatorships in response to a deterioration in the nation’s housing market that damaged the financial condition of each, and left both of them unable to fulfill their missions without government intervention.
The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 as amended by the Housing and Economic Recovery Act of 2008, authorizes the FHFA as conservator to “take such action as may be necessary to put the regulated entity in a sound and solvent condition; and appropriate to carry on the business of the regulated entity and preserve and conserve the assets and property of the regulated entity.”
Sen. Warren’s request came in light of FHFA Director William Pulte not responding to letters or providing answers on the topic.
“In an effort to gain clarity about the reprivatization process, we sent multiple inquiries to FHFA regarding its role as conservator of the Enterprises,” added Sen. Warren. “I have been led to the conclusion, however, that FHFA Director Pulte may have no information, insight, or answers on the topic, in part due to his focus on ousting members of the Federal Reserve Board of Governors and certain Democratic leaders.”
Sen. Warren closed the letter with a series of requests to the Treasury Secretary, among them:
- How do you expect stakeholder roundtables to inform any decisions made with regard to the Enterprises?
- What proposals, advice, or other information, if any, has the Treasury discussed regarding the status or reprivatization of the Enterprises?
- What independent analyses, if any, has your agency conducted to assess the potential effects of removing the Enterprises’ explicit federal guarantees on: mortgage rates, the multifamily housing market, housing costs, investor confidence, and market liquidity?
- What independent analyses, if any, has your agency conducted to assess the potential effects of reprivatizing or altering the status of the Enterprises on the Federal Housing Administration, Ginnie Mae, and the broader housing finance ecosystem?
- Do you agree that the federal government should assess all potential effects on consumers and the economy before reprivatizing or otherwise altering the status of the Enterprises and taxpayer interests?
Sen. Warren has called for responses to her requests for information no later than October 8, 2025.
Click here to read the full letter from Sen. Warren to Treasury Secretary Bessent.
