Enacted by Congress at different times in history to help citizens achieve the dream of homeownership, Fannie Mae and Freddie Mac provide liquidity, stability, and affordability to the greater mortgage market.

Both Fannie Mae and Freddie Mac are mortgage-backing entities that aim to boost the housing market—but each does so in a unique way. Let’s delve into how each of these lend an assist to your journey toward homeownership.

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Fannie Mae (Federal National Mortgage Association)

• A key mechanism for facilitating homeownership
• The largest backer of 30-year fixed-rate mortgages
• Provides funding for mortgages by purchasing loans from banks and other lenders
• Sells purchased mortgages as mortgage-backed securities to investors—this helps build liquidity in the mortgage market, which means more loans and housing affordability

Fannie Mae boasts many programs for both first-time and repeat homebuyers. Some of these products are intended to help you buy a home or refinance with a lower rate or even assist you in purchasing real estate owned (REO) property. Click here for a full listing of Fannie Mae mortgage products.

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Freddie Mac (Federal Home Loan Mortgage Corporation)

• Created as part of the Emergency Home Finance Act as a way to expand the country’s secondary mortgage market
• Purchases bundled home mortgages as mortgage-backed securities, primarily from smaller banks and savings and loans
• Helps lenders mitigate risks and makes funds available for loans

Freddie Mac offers an array of products and services, all aimed at assisting borrowers in different ways. These innovative mortgage offerings address an array of situations, like financial assistance, renovations, cash-out refinances, and more. Click here for a full listing of Freddie Mac products.

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