The Federal Home Loan Mortgage Corporation — a government-sponsored enterprise similar to Fannie Mae that buys conforming mortgages and provides market liquidity.
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Freddie Mac (Federal Home Loan Mortgage Corporation) was created by Congress in 1970, partly to compete with Fannie Mae and expand the secondary mortgage market. Like Fannie Mae, it purchases conforming mortgages from lenders, securitizes them, and sells the securities to investors. Together, Fannie and Freddie own or guarantee about half of all US single-family mortgages. Freddie Mac has its own guidelines (overlapping significantly with Fannie's) and its own automated underwriting system (Loan Product Advisor, or LPA — vs. Fannie's Desktop Underwriter, or DU). Freddie Mac was also placed into conservatorship in 2008 and remains under FHFA supervision. It introduced the 3% down conventional loan (Home Possible) in 2015.
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