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Fannie Mae and Freddie Mac: what it means

Fannie Mae and Freddie Mac are two companies created by Congress that buy mortgages from lenders. They hold them or package them into mortgage-backed securities (MBS) that may be sold to investors, and they guarantee those investors timely payment of principal and interest.

In Spanish it is

Fannie Mae y Freddie Mac

Also written as: Fannie Mae · Freddie Mac · the Enterprises · GSEs · government-sponsored enterprises

A couple reads a leaflet together on the sofa at home.

Verified on October 17, 2026

4 official sources

See the whole dictionary

The full explanation

Lenders use the cash from those sales to keep making home loans. They are not federal agencies: they are shareholder-owned companies that operate under a congressional charter. The Federal Housing Finance Agency (FHFA) supervises them and runs them under conservatorship.

An example

Rosa's conventional loan meets Fannie Mae's rules. After closing, her lender sells it to Fannie Mae and uses that money to lend to another family.

You will see it in…

The rules for conventional (conforming) loans
Your county's conforming loan limits
The names of conventional loan programs, such as Freddie Mac's Home Possible or HomeOne

Words that go with it

You will rarely see this word alone. These are the ones that show up with it on the same papers.

More guides that use “Fannie Mae and Freddie Mac”

Still confused by a paper?

A HUD-approved housing counselor can walk you through it. Agencies usually charge little or nothing, many work in Spanish, and they do not sell you anything.

What a housing counselor does See free help

Official sources

We sum up what these official sources say, in plain words. We add no rules they do not state; when a rule changes, the definition and its date change.

1. Federal Housing Finance Agency (FHFA) · About Fannie Mae & Freddie Mac (external site) · in English · Verified on October 17, 2026
2. CFPB · Mortgages key terms: Fannie Mae; Freddie Mac (external site) · in English · Verified on October 17, 2026
3. Federal Housing Finance Agency (FHFA) · About FHFA (external site) · in English · Verified on October 17, 2026
4. Freddie Mac · CHOICERenovation Mortgages (external site) · in English · Verified on October 17, 2026