Trump's Housing Chief Expands Mortgage Spending, Raises Risk for Lenders

• Bill Pulte, Trump's housing finance director, authorized Fannie Mae and Freddie Mac to nearly double a $200 billion bond purchase, raising their individual caps to $225 billion.
• This move could increase bond purchases by $170 billion beyond Trump's initial order and reverses nearly two decades of bipartisan consensus on limiting risk for government-backed lenders.
• Senator Elizabeth Warren criticized the move as a "smoke screen" that won't significantly lower mortgage rates long-term and raises risks for Fannie and Freddie.
• Pulte, who also chairs Fannie Mae and Freddie Mac, has had a turbulent tenure, including pushing for federal criminal investigations and firing ethics officials.
• Economists and housing experts criticize the plan as a "gimmick" that could reintroduce risks similar to those before the 2008 financial crisis.

Why It Matters: Trump's housing chief significantly increased mortgage spending authority, sparking concerns about heightened risk for lenders.