Fannie and Freddie earn $7.8 billion as purchase lending picks up
Fannie Mae made $4.0 billion and Freddie Mac $3.8 billion in the second quarter, lifting combined net worth to about $194 billion. Both remain in conservatorship, and Treasury's claim on them grew again.
By American Policy WireFiled
The bottom line The two companies behind most conventional mortgages are earning more and buying more purchase loans, but their capital still falls short of what FHFA's rules would require outside conservatorship.
Fannie Mae and Freddie Mac reported a combined $7.8 billion in second-quarter profit last week, as home-purchase lending picked up at both companies and their net worth climbed to about $194 billion [1, 2]. Both are still in federal conservatorship, now in its 18th year [2].
Why it matters: Together the two companies guarantee a $4.1 trillion and a $3.7 trillion book of mortgages, and the fees they charge on new loans feed into what borrowers pay [1, 2]. Their capital also sets the starting point for any change to the conservatorships, and Fannie’s alone is still $33 billion short of what regulators would require of it outside federal control [1].
By the numbers
- $4.0 billion: Fannie Mae’s net income, up from $3.7 billion in the first quarter and 20% above a year earlier. Its net worth reached $116.5 billion [1].
- $3.8 billion: Freddie Mac’s net income, up 61% from a year earlier, mostly because it released credit reserves this time after building them in the second quarter of 2025. Its net worth hit $78 billion [2].
- $111.2 billion: Fannie’s single-family conventional acquisitions, up from $98.7 billion. Purchase volume rose $17.9 billion while refinance volume fell $5.4 billion [1].
- 52% and 55%: First-time buyers’ share of single-family purchase loans at Freddie Mac and Fannie Mae, respectively [2, 1].
- $194 billion: The two companies’ combined net worth on June 30, against about $381 billion in Treasury liquidation preference [1, 2].
What changed this quarter: Purchase lending carried Fannie. It financed about 201,000 home purchases and 117,000 refinancings, with nearly 110,000 first-time buyers [1]. Freddie funded 306,000 single-family mortgages, including 200,000 purchase borrowers, up from 165,000 in the first quarter, while refinance borrowers dipped to 106,000 [2].
Freddie’s profit got a lift from accounting rather than from lending. It booked a $0.9 billion benefit for credit losses, which it attributed mainly to “updates to the company’s process for generating future house price scenarios” [2]. Fannie went the other way, raising its credit-loss provision to $485 million from $277 million, with more than half of it tied to apartment loans [1].
Who runs them: William Pulte chairs both boards and signs the releases as “Director, U.S. Federal Housing” [1, 2]. He said Fannie’s results show “the company’s continued stability and growth” [1]. Fannie is led by an acting chief executive, Peter Akwaboah [1].
What it means for buyers and owners:
- Guarantee fees on new loans eased at Fannie. Its average charged fee on newly acquired single-family loans fell to 53.5 basis points from 55.1 in the first quarter [1]. Freddie’s held at 54 basis points [2].
- Credit standards stayed tight. New Freddie single-family loans carried a weighted average credit score of 761 and an original loan-to-value ratio of 76% [2]. Fannie’s book carried an average mark-to-market loan-to-value of 51% [1].
- Rates rose through July. Freddie Mac’s survey put the 30-year fixed at 6.66% on July 30, up from 6.43% on July 2, and the 15-year at 6.04% [3]. The Fed held its target range at 3.50% to 3.75% on July 29 [4], as covered in our report on the Fed’s split vote.
- Late payments are inching up at Freddie. Its single-family serious delinquency rate was 0.60%, up from 0.55% a year earlier; Fannie’s held at 0.58% [2, 1].
What Treasury is owed: Treasury’s claim has grown along with the retained earnings. Treasury’s senior preferred liquidation preference reached $234.2 billion at Fannie on June 30, up from $227.0 billion at the end of 2025 [1]. At Freddie it rose to $146.6 billion from $143.0 billion a quarter earlier [2]. Freddie still has $140.2 billion in untapped Treasury funding available under its purchase agreement [2].
What’s next: Freddie Mac publishes its next weekly rate survey on Thursday, August 6 [3]. Neither company’s release gives a date for any step toward leaving conservatorship [1, 2].
The other side: Apartment lending is the soft spot. Fannie’s multifamily serious delinquency rate fell to 0.60% from 0.78%, but mostly because a loan portfolio in forbearance was modified and foreclosures were completed; new loans kept going bad from “sustained market challenges” [1]. Chief Financial Officer Chryssa Halley said on the earnings call: “Looking ahead, we expect ongoing multifamily market challenges to result in additional delinquencies” [5]. Freddie’s multifamily delinquency rate rose to 0.51% from 0.47% a year earlier [2].
Q&A Quick answers
- Q1How much did Fannie Mae and Freddie Mac earn in the second quarter of 2026?
- Fannie Mae reported $4.0 billion in net income and Freddie Mac $3.8 billion, about $7.8 billion together [1, 2]. Fannie's profit rose 20% from a year earlier and Freddie's 61% [1, 2].
- Q2Are Fannie Mae and Freddie Mac still in conservatorship?
- Yes. Both label their financial statements as in conservatorship, and Freddie Mac says it has operated under FHFA conservatorship since September 2008 [1, 2].
- Q3Did Fannie Mae's guarantee fee go up in 2026?
- Not on new loans. Fannie's average charged fee on newly acquired single-family loans fell to 53.5 basis points from 55.1 in the first quarter, while the average across its whole book edged up to 49.0 basis points [1]. Freddie's fee on new single-family business held at 54 basis points [2].