Some large lenders are seeing their cash-window availability capped or being cut off altogether, according to trading advisors. Communications from the GSEs and FHFA on the matter are vague.

The growing securities holdings in Fannie’s retained mortgage portfolio include a large share of non-Fannie agency MBS.

Federal Reserve Ends Balance Sheet ReductionAfter 42 straight months of allowing its security holdings to run off, the Federal Reserve finally said “enough.” The central bank’s current balance sheet: $6.134 trillion.

Bill Ackman’s plan calls for Treasury to forgive its senior preferred shares, a strategy that some industry observers say would be politically risky for President Trump.

Securities industry stakeholders say preservation of the secondary mortgage market, especially MBS futures trading on the TBA market, is essential to keeping mortgage rates low.

While the Fed is moving away from purchases of agency MBS, portfolio managers at PIMCO believe additional purchases are warranted. In the meantime, the GSEs are increasing their investments.

Trade groups representing smaller lenders called on the Trump administration to prompt the GSEs to increase their holdings of MBS as a way to reduce mortgage rates.

Neither Fannie nor Freddie issued any green bonds in the third quarter, though social bond issuance has been relatively healthy.

In the early years of Fannie/Freddie conservatorship, investors were seeking an explicit guarantee of GSE MBS as part of any reform effort. More recently, they have shown an acceptance for maintaining an implicit guarantee.

The securitization rate for residential mortgages came down after reaching an elevated level in the first quarter of 2025. The rate declined for both GSE-eligible mortgages and non-agency loans during the second quarter. (Includes data table.)