President Donald Trump signed an executive order Thursday that tells federal housing agencies to cut mortgage insurance and title costs and to lower interest rates on direct home loans from the U.S. Department of Agriculture.
The White House published the order, titled “Decreasing Housing Costs for the American People,” on Oct. 22. It says the goal is to “reduce regulatory barriers to mortgage origination and costs impeding homeownership.”
What the order does
- USDA and VA loan rates: The secretaries of Agriculture and Veterans Affairs must reduce the interest rates on single-family home loans their departments make directly to buyers, within current law and available funding.
- Mortgage insurance: The director of the Federal Housing Finance Agency may have Fannie Mae and Freddie Mac start a pilot program that checks home values and drops mortgage insurance once a borrower has enough equity. The pilot covers only loans made after it starts.
- Title insurance on refinances: The order would expand a pilot that lets Fannie Mae and Freddie Mac accept an automated title review instead of a lender’s title insurance policy on some refinances. Savings must be passed on to borrowers.
- Factory-built homes: A new Task Force on Manufactured Housing Innovation, led by HUD and the FHFA, has 180 days to recommend ways to cut rules that slow down manufactured and factory-built homes.
Why rural buyers may notice
USDA’s direct loans, often called Section 502 direct loans, are made by USDA Rural Development to buyers with low and very low incomes in eligible rural areas. The order cites the federal law behind that program. The VA section cites the law for VA’s direct loans, which mainly serve Native American veterans.
The order does not set a new rate. It also does not say when any cuts would take effect. Each department must act under its own authority and budget.
What comes next
- Agency action: USDA, VA and the FHFA must each decide how to carry out their parts.
- Task force report: Recommendations on factory-built housing are due to the president within 180 days.
- Limits: The order says it must be carried out “consistent with applicable law and subject to the availability of appropriations.”
The White House has also pushed other cost measures this week, including the data center electricity pledge.
Sources: The White House; U.S. Department of Agriculture.
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