President Donald Trump has signed an executive order aimed at making homeownership more affordable amid rising interest rates and inflation. The order directs federal agencies to proactively cancel mortgage insurance for eligible future loans and expand a program that makes refinancing cheaper, potentially saving millions of Americans thousands of dollars. However, experts caution that the full consumer impact remains uncertain without further details on implementation.
In a significant move to ease the burden of homeownership amidst escalating interest rates and persistent inflation, President Donald Trump has enacted an executive order targeting mortgage costs. This directive aims to make housing more accessible and affordable for Americans, addressing a critical concern for many households.
The order, formally titled "Decreasing Housing Costs for the American People," outlines several key initiatives. Among them, federal agencies are instructed to proactively cancel mortgage insurance on eligible future loans and to expand a program designed to reduce refinancing expenses. The Federal Housing Finance Agency (FHFA) Director Bill Pulte, commenting on the measure in an X post on Thursday, proclaimed that "millions of Americans will save thousands and thousands of dollars."
However, industry experts like Keith Gumbinger, vice president of mortgage website HSH, caution that the ultimate impact on consumers remains uncertain without more specific details regarding the implementation of the order.
This executive order comes just weeks before the Nov. 3 midterm elections, a period where rising living costs and housing affordability are prominent issues for voters. It also builds upon previous directives, such as an order in January 2026 to restrict Wall Street firms from purchasing single-family homes.
The need for such measures is underscored by recent data. The Federal Reserve's latest Survey of Consumer Finances, published in early October, revealed that in 2025, the monthly payment for a 30-year fixed-rate mortgage on a median-priced home consumed approximately 33% of the median family's income, a notable increase from 26% in 2022. Whether you're currently a homeowner or aspire to be one, understanding the implications of this new order is crucial.
Mortgage Insurance Under Scrutiny
For conventional loans—those not government-insured or backed—private mortgage insurance (PMI) is typically required when a down payment is less than 20% of the home's purchase price. In contrast, Federal Housing Administration (FHA) mortgages mandate mortgage insurance on all loans.
Trump's executive order directs the FHFA to launch a pilot program that will proactively cancel eligible borrowers' mortgage insurance once their home equity reaches a predetermined threshold. This change would apply to mortgages originated after the pilot program's inception.
Under current rules, conventional loan borrowers generally have the option to remove PMI once their loan balance falls below 80% of the original purchase price, or automatically once it hits 78% of the original value, according to Fannie Mae. Seth Appleton, president of U.S. Mortgage Insurers, an industry trade organization, released a statement acknowledging the President's focus on cost reduction, noting that the private mortgage insurance industry already contributes to this goal.
The cost of PMI can range from 0.2% to 2% of the loan annually, varying based on factors like down payment size, credit score, and the amount borrowed, as per Fannie Mae. For instance, a $600,000 home with a 10% down payment and a 30-year fixed-rate mortgage at 7.3% could incur a monthly mortgage insurance payment of around $351, according to Freddie Mac's calculator.
Gumbinger points out that "Most mortgages... are carrying PMI at this point in time, especially with the way home prices have been and down payments being as small as they've been in recent years." Data from Realtor.com's September 2026 report indicates that the median home down payment in the second quarter of 2026 was 13.7% of the purchase price, or $27,100.
Easing Mortgage Refinancing Costs
Another aim of the executive order is to reduce mortgage refinancing costs. This will be achieved by making permanent the FHFA's pilot program, which waives the lender's title insurance policy and permits "cost-friendly alternatives," according to the White House.
While Gumbinger suggests it may not be a "game-changer" for the overall cost of housing, which is largely driven by home prices and mortgage rates, he concedes that "every little bit certainly helps." As of Oct. 23, mortgage interest rates for 30-year fixed-rate mortgages stood at 7.32%, with refinance demand plummeting by 59% in mid-October compared to the previous year, according to Freddie Mac.
The FHFA pilot program, initially planned through November 2027, was "limited in scope" for refinances with a loan-to-value ratio below 80% and active in a select number of states, as noted by former FHFA Director Sandra Thompson in an April 2024 congressional hearing. Thompson estimated that this pilot could save consumers between $500 and $1,500 in closing costs for loans sold under the program.
Making this program permanent could lead to significant savings for borrowers, as the lender's title insurance policy, typically required for both new loans and refinances, "has always been fairly pricey," Gumbinger observed. Indeed, lender fees associated with title and title insurance generally represent the largest portion of mortgage closing costs, according to a 2025 Urban Institute report.
