Hedge fund manager urges Trump administration to end conservatorship of the mortgage giants by the end of 2027
Billionaire hedge fund manager Bill Ackman has renewed calls for the Trump administration to release Fannie Mae and Freddie Mac from conservatorship, suggesting a future Democratic administration could weaponize the mortgage giants against the Republican Party.
Ackman, the founder and chief executive officer of Pershing Square Capital Management and a prominent Trump donor, said in a Thursday CNBC interview that he viewed the release of the government-sponsored enterprises as “politically critical” before the end of the Trump administration in 2028.
“Why is that the case? Because this is an enormously cashflow-generative asset that in the hands, for example, of a Democratic administration, could be used in a manner that is politically very threatening to the Republican Party,” Ackman told Sara Eisman.
“The control of who gets access to mortgages – and there were, obviously, issues during the Biden administration where there were mortgages being granted to people on favorable terms because of skin color and other such initiatives. And that’s a tool that can be used in a very political manner.”
The Biden administration made housing equity a formal policy priority, with the Federal Housing Finance Agency (FHFA) – which oversees Fannie and Freddie – announcing a 2023 change to the overall fee pricing structure based on credit ratings and downpayment amounts.
That was characterized in conservative circles as punishing high-credit-score borrowers to subsidize low-credit-score ones, although the policies were not centered around race.
Billionaire’s comments revive hot topic for mortgage industry
Ending the conservatorship of Fannie and Freddie – which have been under that arrangement since the global financial crisis – was a prominent discussion point for the Trump administration last year, although it’s faded in 2026 amid new concerns including the Iran conflict and tariff disputes.
Ackman’s latest comments could rekindle the debate. “Having met with the administration about this topic, I think they view it as absolutely mission-critical… they’re both released from conservatorship,” he said. “We have put forth a very straightforward plan that will get it done more efficiently.”
He said it was “really important” that stock was sold to institutional investors and that the GSEs were fully privatized to prevent Fannie and Freddie from becoming politically controlled assets.
Last year, President Trump hinted at an initial public offering (IPO) of Fannie and Freddie under a holding company called the Great American Mortgage Corporation, under which both assets would remain in partial conservatorship.
But Ackman dismissed that prospect. “It is not a viable structure,” he said. “The simplest outcome here that creates the most value for the American taxpayer is just simply accounting for the $300 billion of payments that have been made… by Fannie and Freddie to the Treasury, fully repaying the $191 billion that was advanced during the financial crisis, and then an uplisting to a major exchange like the New York Stock Exchange.”
‘No scenario’ in which ending conservatorship would threaten market
Concerns over the GSEs’ capital levels are frequently cited as a reason to move cautiously on ending their conservatorship, but Ackman said their current capital is “more than sufficient” to begin the process, describing it as a fortress-level balance sheet.
A commitment fee paid by companies for the current government backstop – valued at about $450 billion – would give Fannie and Freddie a “stupid” amount of capital, he added.
“There’s no scenario in which these entities would be a threat to the market,” Ackman said. “I would argue mortgage spreads tighten in that world because the fear would be, if it’s a Democratic administration that wins the next presidential election, I think that creates uncertainty about how Fannie and Freddie are going to be used, what’s going to happen with their capital.”
While ending conservatorship seems to have been placed on the backburner this year, Ackman said he sees the end of 2027 as a realistic target to bring the mortgage giants into the open.
“If I were [them], I would get busy on this right after the turn of the year and get it done in the 2027 timeframe,” he said.
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