President Donald Trump’s federal housing finance director, Bill Pulte, quietly granted government-backed lenders the authority to nearly double a $200 billion bond purchase that Trump ordered to try to lower mortgage rates, a move that could introduce a new level of risk for the companies.

An email obtained by The Associated Press that was sent by the Federal Housing Finance Agency to top officials at Fannie Mae and Freddie Mac eliminated caps that prohibited the lenders from each holding more than $40 billion in mortgage bonds.

The Jan. 12 email says that “effective immediately” the new amount of mortgage bonds that they could hold in their portfolios was raised to $225 billion apiece.

If the mortgage buyers were to act on the full extent of this new authority, that would amount to a roughly $170 billion increase in bond purchases over what the president instructed them to buy.

Neither Pulte nor the FHFA addressed questions about whether Trump or Treasury Secretary Scott Bessent was consulted before the increase was enacted.

The changes to the purchasing rules effectively reverse nearly two decades of bipartisan consensus that limits should be imposed after the government had to bail out Fannie Mae and Freddie Mac in the aftermath of the financial crisis of 2008-09, which led to both being placed into a government conservatorship.

Before this story was published, Pulte took to X, calling it “fake news.”

“FHFA simply gave each entity legal flexibility to go beyond their previous caps,” Pulte wrote Friday, adding that despite the lenders’ new bond purchasing authority, they would not “exceed $200 billion.”

After the story was published, the agency put out additional statement saying that “Fannie and Freddie will not be allowed to go beyond the president’s buy.”

The White House, Fannie Mae and Freddie Mac did not respond to requests for comment. The Treasury Department, in a statement, said Pulte has been “collaborative and transparent” in working with the department.

The statement did not address the bond purchases.

Some members of Congress who were closely involved in the fallout from the financial crisis have raised concerns about Pulte and the Republican administration’s new approach.

They say any benefit from the mortgage bond purchase will be fleeting unless the tight supply of homes can be increased.

Without that, they argue, any decrease in interest rates will only drive up home prices as sellers adapt to the lower cost of borrowing by increasing their asking prices.

“This is just a smoke screen for Trump and Bill Pulte to tweet about — it will do little, if anything, to lower mortgage interest rates over the long term and raises questions about increased risks to Fannie and Freddie,” said Sen. Elizabeth Warren of Massachusetts, the top Democrat on the Senate’s banking committee.

The episode offers the latest example of Pulte’s turbulent tenure in a typically low-profile position in the federal bureaucracy.

Pulte, who also appointed himself chair of Fannie Mae and Freddie Mac, has used the post to cultivate his own political profile and spearheaded efforts to initiate federal criminal investigations of some of Trump’s chief antagonists.

Pulte was identified as a driving force behind the administration’s decision to criminally investigate Federal Reserve Chair Jerome Powell, according to Bloomberg News, provoking an outcry from some prominent Republicans in Congress.