If you’ve been hearing noise about Fannie Mae and Freddie Mac lately and wondering “what does this mean for my mortgage?”, you’re asking the right question. Let me cut through the confusion and give you the strategic intelligence that actually matters.
What Are Fannie Mae and Freddie Mac, and Why Should You Care?
First, the foundation: Fannie Mae and Freddie Mac are the two companies that make most mortgages in America possible. They don’t lend money directly to homebuyers. Instead, they buy mortgages from banks and lenders, which gives those lenders cash to make more loans to more buyers like you.
Here’s why this matters: These two companies back about 70% of all mortgages in America. When you get a conventional mortgage, there’s a very good chance Fannie or Freddie is behind it, guaranteeing that loan. This government backing keeps mortgage rates lower than they’d otherwise be, experts estimate it saves you about 0.5 percentage points on your interest rate.
Since the 2008 financial crisis, the U.S. government has owned and controlled both companies through something called “conservatorship.” Think of it like the government putting them in time-out and managing them directly after they nearly collapsed. The government bailed them out with $187 billion, and in return, the government has been collecting their profits ever since.
The big question for 2025: What happens next? Do they stay government-controlled? Do they go private? And what does any of this mean for your ability to buy a home in North Texas?
The Real Story Behind Ackman’s Power Play
On November 18, 2025, billionaire investor Bill Ackman dropped a proposal that caught most people sleeping. His hedge fund Pershing Square owns over 210 million shares in Fannie Mae and Freddie Mac combined, making him the largest common shareholder in both companies. That’s not coincidence. That’s strategy.
Here’s what everyone’s missing: Ackman isn’t proposing revolution. He’s proposing calculated evolution that protects his massive investment while claiming to protect taxpayers. The plan has three deceptively simple steps that could reshape how 70% of American mortgages get financed.
Step One: Acknowledge the bailout got repaid. Since 2008, Fannie and Freddie have returned hundreds of billions to Treasury, far exceeding the original $187 billion bailout. Ackman says taxpayers are up $25 billion. That’s marketing genius: frame this as “mission accomplished” rather than “massive institutional change.”
Step Two: Exercise government warrants at nominal prices. Instead of a rushed IPO, Treasury would exercise warrants to purchase 79.9% stakes in both companies. Ackman estimates this government ownership would be worth over $300 billion, a number designed to sound huge for taxpayers while actually being $600+ billion less than the Trump administration’s reported $1 trillion valuation target.
Step Three: Relist on the NYSE immediately. Ackman claims both companies already meet listing requirements and NYSE officials are ready to move forward. This creates liquidity for existing shareholders (like him) while maintaining the appearance of government control.
See the brilliance? It’s not a privatization pitch. It’s a “have your cake and eat it too” proposal that tries to satisfy investors, politicians, and the public simultaneously.
What This Actually Means for Your Mortgage Rate
Let me cut through the noise: Ackman’s specific plan probably doesn’t move your mortgage rate much at all.
Realtor.com senior economist Joel Berner nailed it: “This proposal would allow retail investors to get a piece of this action, but would not remove the essential government guarantees that make Fannie and Freddie reliable.” Translation: the fundamental market mechanics stay intact.
The government guarantee is what keeps mortgage rates reasonable. It’s why Fannie and Freddie can borrow cheap and pass those savings to you. That implicit backing reduces rates by approximately 0.5 percentage points compared to purely private lending.
Here’s where it gets interesting for North Texas buyers: Ackman’s plan maintains that backing. Other privatization scenarios being floated? That’s where the danger lurks.
Full privatization without guarantees could trigger:
- Mortgage rate increases of 0.25% to 0.40% from immediate market uncertainty
- Potential spikes up to 1% if investor confidence collapses without explicit government backing
- Stanford research projects 0.2 to 0.8 percentage point increases translating to $500-$2,000 annually on typical mortgages
On a $400,000 home, right in the sweet spot for Ellis County, Midlothian, and southern DFW suburbs, even a 0.5% rate increase means roughly $120 extra monthly. Over 30 years? That’s $43,200 in additional interest you’re handing to lenders instead of building equity.
But here’s the strategic read: The Trump administration wants this done fast, and Ackman’s proposal gives them cover to claim victory while changing little. That’s actually the most likely scenario, which means mortgage market disruption is probably overblown in the short term.
The First-Time Buyer Equation: This Is Where It Gets Dangerous
Forget rates for a minute. The real threat to North Texas first-time buyers isn’t about interest percentages, it’s about access to credit entirely.
Here’s what happens when Fannie and Freddie prioritize shareholder returns over housing mission:
Lending standards tighten immediately. Private companies focused on profit margins don’t take risks on 3% down payment loans to buyers with 680 credit scores. They want 20% down from borrowers with 740+ scores who can survive any economic shock.
Affordable housing programs get gutted. We’ve already seen the preview: in March 2025, FHFA directed Fannie and Freddie to end all Special Purpose Credit Programs, eliminating down payment and closing cost assistance for first-time and low-income buyers. That wasn’t random, that was a test balloon for what happens when shareholder value trumps public mission.
Down payment requirements balloon. The current 3-5% minimums through HomeReady and Home Possible programs? Those exist because Fannie and Freddie have Congressional mandates to support affordability. Remove that mandate, and suddenly you need 15-20% down to even get a conversation with a lender.
For North Texas first-time buyers already struggling with median home prices around $350,000 across the metroplex, this creates an impossible math problem. Saving $17,500 for 5% down is achievable over 2-3 years. Saving $52,500 for 15% down? That’s 6-8 years for most households, during which time home prices will continue appreciating.
This is the wealth transfer moment most agents won’t tell you about: If you’re qualified now under current standards, you need to act before those standards change. Period.
Reading the North Texas Market Reality: What the Data Actually Shows
Let me give you the unfiltered market intelligence for our territory, because context matters when you’re making six-figure decisions.
Texas A&M’s Real Estate Research Center projects for 2025:
- Single-family sales increasing about 3% statewide, first meaningful growth since the pandemic
- Median home prices ending around $350,000
- Mortgage rates averaging 6.4% in H2 2025, declining to 6.1% in 2026
- Single-family rents flat to slightly up around $2,200 monthly
But state-level data obscures what’s happening in our backyard. Dallas-Fort Worth specifically shows:
- Home values down 2.8% over 12 months ending May 2025
- Active listings surged to 29,000 units, massive inventory increase
- Zillow forecasting continued gradual declines through mid-2026, potentially down another 2.2%
- Some analysts projecting 10-20% corrections as inventory normalizes
After six straight quarters of declining apartment rents, the metroplex is positioned for modest recovery with 1.5% year-over-year rent increases by Q4 2025.
Here’s my strategic read: We’re in a transitional market where sellers who priced aggressively in 2022-2023 are getting reality checks, but fundamentals remain strong. Corporate relocations continue, job growth stays positive, and Texas maintains tax and regulatory advantages that drive migration.
This is NOT 2008. We don’t have subprime loan exposure, over-leveraged buyers, or speculation-driven inventory. We have normalization after a historic run-up, which means opportunity for strategic buyers.
The Financing Intelligence Your Agent Should Provide (But Probably Isn’t)
Most agents will tell you to “get pre-approved” and call it strategy. That’s not strategy. That’s checking a box.
Real strategy looks like this:
Pre-approval timing is now a weapon. If lending standards tighten in six months, your pre-approval today locks in qualification under current guidelines. Work with lenders who understand Fannie Mae and Freddie Mac guideline changes, not order-takers at big banks who just plug numbers into automated systems.
Alternative loan programs become critical. Don’t just look at conventional financing:
- FHA loans allow 3.5% down with credit scores as low as 580
- VA loans offer 0% down for veterans with no PMI
- USDA loans provide 0% down in eligible areas (yes, some North Texas suburbs qualify)
- Portfolio loans from local lenders who keep mortgages on their books instead of selling to Fannie/Freddie
Financial positioning beats market timing. You can’t control Fannie and Freddie reform, but you absolutely control:
- Your credit score (aim for 740+ for best rates)
- Your debt-to-income ratio (below 43% conventional, lower is stronger)
- Your down payment amount (more down = less lender risk)
- Your cash reserves (3-6 months demonstrates stability)
The buyers who win in uncertain markets are the ones who qualify for everything, then choose the best option rather than hoping they squeeze into something.
The NAR Settlement Reality: What Actually Changed (And What Didn’t)
Since we’re talking about industry disruption, let’s address the elephant in the room: the NAR settlement that supposedly changed everything about real estate commissions.
Effective August 17, 2024:
- Sellers no longer advertise buyer agent commissions on MLS platforms
- Buyers must sign written agreements with agents before touring homes
- All commission rates remain fully negotiable (they always were, but now it’s explicit)
The prediction? Commissions would plummet as buyers demanded discounts and sellers refused to pay buyer agents.
The reality? Average combined buyer and seller agent commissions actually increased from 5.32% to 5.44% in mid-2025. On a median $367,711 home, that’s about $20,003 in total realtor fees.
Why? Because good agents provide value, and buyers paying their own agents directly realized those agents need reasonable compensation to provide good service. Shocking concept, I know.
The lesson: Don’t make decisions based on what might happen. Make decisions based on what value you’re actually receiving.
Strategic Decision Framework: Should You Buy Now or Wait?
This is where most content fails you, giving generic advice that applies to nobody specifically. So let me give you the actual decision framework.
Buy now if:
✓ You’re financially qualified under current standards but might not be if lending tightens
✓ You’ve found property that meets your needs in a location with strong fundamentals
✓ Your life circumstances (family size, job location, school districts) make ownership beneficial
✓ You understand North Texas inventory is elevated, giving you negotiating leverage
✓ You’re planning to hold for 5+ years, making short-term price fluctuations irrelevant
✓ Current mortgage rates around 6.4% are manageable for your budget, and you can refinance later if rates drop
Wait if:
✓ Your financial qualification is borderline, and you’d benefit from 6-12 months to strengthen credit, reduce debt, or increase savings
✓ You’re speculating on significant price drops in your specific target market (but understand you’re also speculating on rate stability)
✓ Your life circumstances are uncertain (job changes, relocations, family size) within the next 2-3 years
✓ You’re trying to time the absolute market bottom, and you’re okay potentially missing out if rates increase or inventory decreases
✓ You can invest your down payment funds elsewhere at returns exceeding homeownership benefits
The Franklin perspective: While everyone else obsesses about what might happen with Fannie and Freddie six months from now, strategic players focus on the opportunity in front of them today. Current North Texas inventory of 29,000 units creates buyer leverage that may not persist.
What Your Agent Should Actually Be Doing For You
Here’s the uncomfortable truth: most agents are order-takers, not strategists. They show houses, write contracts, and pray nothing goes wrong in escrow.
A strategic agent operates differently:
Market intelligence you can’t Google: Tracking off-market inventory, pending development projects, infrastructure changes, and demographic shifts before they hit mainstream awareness. What’s coming next to Ellis County that nobody’s talking about yet? That’s intelligence.
Lending relationship depth: Connections with multiple lenders who specialize in different loan products, understand underwriting nuances, and can explain how Fannie Mae and Freddie Mac guideline changes affect your specific scenario. One lender opinion isn’t strategy. Three lender opinions with different loan products is strategy.
Negotiation positioning: Using current market dynamics, elevated inventory, seller days on market, comparable sale trends, to structure offers that protect your interests. In this market, seller concessions for closing costs, extended due diligence periods, and repair negotiations are all on the table for strategic buyers.
Long-term relationship building: Your agent shouldn’t disappear after closing. They should be monitoring your property value, tracking neighborhood development, and keeping you informed about market conditions that might affect when to refinance, renovate, or sell. That’s relationship, not transaction.
Compliance with evolving regulations: Understanding Fair Housing Act requirements, RESPA disclosures, NAR Code of Ethics, and how Fannie Mae and Freddie Mac guideline changes affect different buyer profiles. Ignorance of regulations doesn’t protect you, it exposes you.
The Questions You Should Actually Ask Your Agent
Forget the generic “what’s the market like?” nonsense. Here are questions that separate order-takers from strategists:
1. “Which lenders are you seeing actually close loans fastest right now, and which ones are creating problems in escrow?”
Quality agents track lender performance across dozens of transactions. They know which lenders approve loans aggressively but create last-minute underwriting nightmares, and which lenders are conservative upfront but reliable at closing.
2. “How are you tracking Fannie Mae and Freddie Mac guideline changes, and how might they affect my specific financial profile?”
If they look confused, they’re not tracking guidelines. If they immediately reference recent updates and how they apply to your situation, they’re actually paying attention.
3. “What percentage of your recent transactions involve first-time buyers, and are you seeing any early signs of tightening lending standards?”
Agents working heavily with first-time buyers have real-time intelligence on underwriting trends. They’re seeing approval rates, documentation requirements, and guideline interpretation before it becomes widespread knowledge.
4. “Based on current inventory trends in my target neighborhoods, do you recommend waiting for potential price corrections or acting now before potential rate increases?”
This forces them to articulate market strategy rather than generic “buy now” cheerleading. Quality agents provide nuanced guidance based on your specific target areas and financial circumstances.
5. “Can you connect me with three different lenders who specialize in conventional, FHA, and VA/USDA loans so I understand all my options?”
Multiple lender consultations provide competitive intelligence on rates, costs, and qualification. Agents who only refer to one lender are either lazy or receiving undisclosed compensation (which RESPA prohibits).
6. “What properties in my target area have been sitting on market longest, and what does that tell us about pricing and negotiation opportunity?”
Strategic agents use DOM (days on market) data to identify motivated sellers and develop negotiation strategies. Generic agents just show whatever pops up in new listings.
Protecting Yourself: The Financial Positioning Strategy
You can’t control Washington policy debates, but you absolutely control your financial positioning. Here’s the systematic approach:
Credit score optimization: Every 20-point improvement in your credit score can reduce your mortgage rate by 0.25-0.50%. Pay down credit card balances below 30% utilization, dispute any errors on your credit report, and avoid opening new credit accounts within six months of mortgage application.
Debt-to-income ratio management: Conventional loans typically allow 43-45% DTI, but lower ratios strengthen your application significantly. Pay off high-interest debt systematically, avoid taking on new obligations like car loans before your mortgage, and consider side income that can be documented if your DTI is borderline.
Down payment strategy: While 3-5% down is possible through various programs, 10-20% down demonstrates financial strength and reduces lender risk. It also eliminates private mortgage insurance once you hit 20% equity, saving $100-300 monthly on typical North Texas home prices.
Cash reserve building: Lenders increasingly value borrowers with 3-6 months of mortgage payments in reserves after closing. This demonstrates financial resilience and often results in better rate pricing. Don’t drain every account to maximize your down payment—maintain reserves.
Employment stability: Lenders scrutinize employment history closely. Job changes immediately before mortgage application can create problems. If possible, secure your mortgage before making career moves. If you must change jobs, stay within the same industry at equal or higher pay.
The Alternative Loan Strategy Your Agent Probably Isn’t Mentioning
Most buyers default to conventional Fannie Mae and Freddie Mac-backed loans because that’s what agents and lenders push. But strategic buyers understand alternatives:
FHA loans for lower down payments: 3.5% down with credit scores as low as 580, more flexible DTI ratios, and less stringent employment history requirements. Yes, you’ll pay mortgage insurance, but you’ll also achieve homeownership years earlier than saving 20% down.
VA loans for veterans: 0% down payment, no PMI requirement, competitive rates, and more flexible credit standards. If you’re military or veteran, this is usually your best option regardless of Fannie Mae and Freddie Mac reforms.
USDA loans for eligible areas: 0% down in qualifying rural and suburban locations. Surprisingly, many North Texas suburbs qualify including portions of Ellis County, Kaufman County, and outlying areas. Income limits apply, but they’re generous for many middle-class buyers.
Portfolio loans from local lenders: Some lenders keep certain mortgages on their books rather than selling to Fannie Mae and Freddie Mac. This provides flexibility on credit scores, DTI ratios, and employment history when you don’t fit the perfect conventional box. You’ll typically pay slightly higher rates, but you’ll get approved when others decline.
Non-QM (non-qualified mortgage) loans: For self-employed buyers, those with complex income sources, or recent credit events, non-QM loans provide paths to homeownership that conventional guidelines prohibit. Rates are higher and down payments larger, but it’s financing when traditional options say no.
Understanding the Broader Regulatory Landscape
Fannie Mae and Freddie Mac reforms don’t exist in a vacuum. The entire real estate and lending landscape is evolving simultaneously:
The NAR settlement changed buyer agency: Mandatory written agreements before home tours, explicit commission disclosures, and clear negotiability. This protects buyers by ensuring they understand agency relationships and compensation before forming emotional attachments to properties.
Fair Housing Act enforcement is intensifying: Discrimination based on race, color, religion, sex, national origin, familial status, or disability remains prohibited. But enforcement now extends to algorithmic bias in automated underwriting, marketing material accessibility, and neighborhood steering. Buyers are protected; agents and lenders face consequences for violations.
RESPA compliance matters more than ever: Proper disclosure of all closing costs, prohibition of kickbacks for settlement service referrals, and transparency around marketing service agreements between real estate and mortgage professionals. The CFPB updated guidance in 2020, focusing on facts-and-circumstances analysis rather than blanket prohibitions.
State-level regulations vary: Texas has specific requirements around option periods, title insurance, and disclosure obligations that differ from other states. Working with agents and lenders who specialize in North Texas ensures compliance with both federal and state requirements.
The Ellis County and North Texas Advantage: Why This Market Remains Strong
Let’s get specific about why our territory, Ellis County, southern DFW, Midlothian, Waxahachie, and surrounding communities, remains fundamentally strong regardless of Fannie and Freddie uncertainty:
Corporate relocations continue: Major employers keep choosing North Texas for headquarters relocations and expansions. This creates sustained housing demand from high-income professionals.
Infrastructure development drives growth: Projects like the 5,200-acre Ferris development, expanded highway systems, and water infrastructure investments support long-term population growth.
Tax and regulatory advantages: No state income tax, reasonable property taxes relative to home values (yes, I know they’re rising, but compare to California or New York), and generally business-friendly policies maintain Texas’s competitive advantage in attracting residents and employers.
Quality of life factors: Good school districts, relatively affordable housing compared to coastal markets, strong job markets, and family-friendly communities make North Texas attractive to the exact demographic profile (young families, professional relocations) that drives sustained housing demand.
Diverse economy: Unlike markets overly dependent on single industries, North Texas has broad economic diversity across technology, finance, healthcare, logistics, and energy. This provides resilience during sector-specific downturns.
This isn’t speculation or cheerleading: These are structural advantages that persist through market cycles and policy changes.
What Happens Next: Reading the Political Chess Game
Let’s be clear-eyed about the most likely scenarios:
Scenario 1: Ackman-style reform (40% probability): Treasury exercises warrants, maintains government backing, relists on NYSE. Minimal mortgage market disruption because fundamental guarantees remain. Private investors get liquidity, politicians claim victory, homebuyers see little change. This is actually the path of least resistance politically.
Scenario 2: Full Trump administration IPO (25% probability): Government sells shares through traditional public offering, potentially reducing backing over time. Mortgage rates increase 0.25-0.50%, lending standards tighten moderately, first-time buyer programs face cuts. Politically difficult because housing affordability concerns make this unpopular.
Scenario 3: Status quo with incremental changes (30% probability): Political gridlock or policy paralysis prevents major reform. Some regulatory changes at margins, but basic structure remains intact. Mortgage market continues current patterns with normal cyclical rate fluctuations.
Scenario 4: Full privatization without guarantees (5% probability): Complete removal of government backing, full shareholder control. Mortgage rates spike 0.50-1.00%, credit access restricted dramatically, housing market disruption. Politically catastrophic, economically disruptive, which makes it unlikely despite some ideological advocates pushing for it.
The strategic read: Most likely outcomes maintain enough government involvement to prevent catastrophic mortgage market disruption. Politicians understand housing crises lose elections. Even the Trump administration, which supports privatization philosophically, understands that actual implementation creating a 2008-style crisis would be political suicide.
Your Move: The Action Plan
Enough theory. Here’s what you actually do:
Week 1: Financial assessment
- Pull credit reports from all three bureaus, dispute any errors
- Calculate current DTI ratio and identify debts to pay down
- Review savings and determine realistic down payment amount
- Schedule consultations with 2-3 lenders to understand qualification under current guidelines
Week 2: Market intelligence gathering
- Identify 3-5 specific target neighborhoods based on commute, schools, amenities
- Research recent comparable sales and current inventory in those areas
- Attend open houses to understand property conditions and pricing at your budget level
- Connect with agents who specialize in your target areas (hint: that includes me for Ellis County and southern DFW)
Week 3: Lending strategy development
- Get pre-approved (not just pre-qualified) with at least one lender
- Compare conventional, FHA, VA, and USDA options if applicable to your profile
- Understand rate locks, timing, and documentation requirements
- Establish relationship with responsive loan officer who can close on time
Week 4: Market entry decision
- Make offer on property that meets your criteria if found
- OR establish systematic property search routine if continuing to look
- Set up automated MLS alerts for new listings in target areas
- Continue monitoring market trends and Fannie Mae/Freddie Mac policy developments
Ongoing: Stay five steps ahead
- Monitor Fannie Mae and Freddie Mac announcements through industry publications
- Track North Texas market inventory, pricing trends, and economic indicators
- Maintain financial positioning even if timeline extends
- Work with professionals who provide strategic intelligence, not just transaction services
The Bottom Line: Strategy Over Speculation
Here’s what I believe after analyzing this situation from every angle:
Bill Ackman’s proposal is smart positioning that gives politicians an easy win while creating liquidity for investors. It’s not revolutionary reform, it’s calculated evolution designed to satisfy multiple constituencies without catastrophic disruption.
For North Texas buyers, the biggest risk isn’t Fannie Mae and Freddie Mac reform, it’s paralysis based on speculation about what might happen. While you’re sitting on the sidelines waiting for perfect clarity:
- Interest rates may increase
- Home prices may appreciate
- Inventory may decrease
- Lending standards may tighten
- Your life circumstances may change
Alternatively:
- Rates might drop (but you can refinance later)
- Prices might decline (but you’re buying for 5+ year hold, making short-term fluctuations irrelevant)
- Better opportunities might emerge (but you might not be positioned to act)
The strategic position: Get financially qualified under current standards, understand your realistic options across different loan products, work with professionals who provide actual intelligence rather than generic advice, and act when you find property that meets your needs in a location with strong fundamentals.
Everything else is noise.
Next Steps: Let’s Talk Strategy
If you’re considering buying or selling in Ellis County, Waxahachie, Midlothian, Red Oak, or anywhere in the southern DFW metroplex, let’s have a real conversation about your specific situation.
Not generic market commentary. Not fear-mongering about what might happen. Strategic intelligence about what’s actually happening in the neighborhoods you’re targeting, which lenders are performing well right now, and how to position yourself for success regardless of how Fannie Mae and Freddie Mac reforms unfold.
I track development projects before they hit public announcements. I monitor lending guideline changes in real-time. I maintain relationships with multiple lenders who specialize in different loan products. And I provide the kind of strategic intelligence that keeps you five steps ahead of whatever chaos the market throws at you.
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Bobby Franklin – REALTOR®
Legacy Realty Group – Leslie Majors Team
This analysis provides educational information and strategic intelligence about housing finance developments. It should not be considered financial or legal advice. Mortgage products, rates, and qualification requirements vary by lender and individual circumstances. Always consult with licensed mortgage professionals and real estate advisors for guidance specific to your situation. This content complies with Fair Housing Act requirements, NAR Code of Ethics, and RESPA regulations. Information current as of November 2025.
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