GSE (Fannie Mae & Freddie Mac)
Government-sponsored enterprises — Fannie Mae and Freddie Mac — that buy conforming mortgages from lenders, keeping money flowing and rates lower.
What does GSE mean?
Fannie Mae and Freddie Mac are the two government-sponsored enterprises at the center of the U.S. mortgage market. They do not lend directly; they buy conforming loans from lenders, freeing those lenders to make more. Their guidelines set what makes a loan conforming — the size limit, credit and down-payment rules — and because they stand behind these loans, conforming borrowers get lower rates than jumbo ones.
Frequently asked
What do Fannie Mae and Freddie Mac do?
They buy conforming mortgages from lenders — they do not lend directly — which frees lenders to make more loans and keeps rates lower. Their guidelines define what makes a loan conforming: the size limit and the credit and down-payment rules.
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