Federal Housing Finance Agency

The **Federal Housing Finance Agency** (FHFA) is an independent U.S. federal agency that supervises and regulates key government-sponsored housing-finance institutions. It oversees Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System, and has served as conservator of Fannie Mae and Freddie Mac since the 2008 financial crisis.^[1]

Role in the U.S. housing-finance system

FHFA occupies a central position in U.S. housing finance because its regulated entities are major sources of mortgage-market liquidity. Fannie Mae and Freddie Mac buy mortgages from lenders, guarantee mortgage-backed securities, and operate in the secondary mortgage market. The Federal Home Loan Banks provide secured wholesale funding, known as advances, to member financial institutions such as commercial banks, thrift institutions, credit unions, insurance companies, and community development financial institutions.^[1]

The agency describes its mission as ensuring that Fannie Mae, Freddie Mac, and the Federal Home Loan Banks operate in a safe and sound manner and serve as reliable sources of liquidity and funding for housing finance and community investment.^[1] This mission combines prudential supervision, housing-mission oversight, and—in the case of Fannie Mae and Freddie Mac—conservatorship powers that are broader than ordinary regulatory oversight.

FHFA is not a mortgage lender, deposit insurer, central bank, or consumer complaint agency. Its work differs from that of the Federal Reserve System, which conducts monetary policy and supervises many bank holding companies; the Federal Deposit Insurance Corporation, which insures deposits and resolves failed insured banks; and the Consumer Financial Protection Bureau, which administers many federal consumer-finance laws. FHFA’s jurisdiction is narrower but highly significant because it covers institutions that affect the cost, availability, and structure of mortgage credit.

FHFA has stated that Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System together provide more than $8.1 trillion in funding for U.S. mortgage markets and financial institutions.^[1] That figure illustrates why the agency is often treated as a financial-stability regulator as well as a housing-finance regulator.

Creation and statutory authority

Congress created FHFA during the financial crisis through the Housing and Economic Recovery Act of 2008 (HERA). The law was signed on July 30, 2008, and substantially revised the supervisory and regulatory framework for housing-related government-sponsored enterprises, including Fannie Mae, Freddie Mac, and the Federal Home Loan Banks.^[3]

HERA created a new independent regulator to consolidate authorities that had previously been divided among other federal bodies. The Federal Reserve’s 2008 annual report summarized that FHFA succeeded to the supervisory and regulatory responsibilities of the Office of Federal Housing Enterprise Oversight for Fannie Mae and Freddie Mac, the Federal Housing Finance Board for the Federal Home Loan Banks, and certain housing-goals and new-program approval authorities that had been held by the Department of Housing and Urban Development.^[3]

FHFA’s own government resources identify the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by HERA, as the primary statutory authority for its regulation of Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System. That authority includes supervision of housing mission and goals and actions as conservator or receiver for Fannie Mae, Freddie Mac, or a Federal Home Loan Bank.^[4]

The agency’s powers under HERA include prudential regulation, capital oversight, examination authority, enforcement tools, and authority to approve or disapprove certain new products. HERA also gave the FHFA director broad authority to establish capital requirements, impose prudential standards, and, where statutory conditions are met, place a regulated entity into conservatorship or receivership.^[3]

Regulated entities

FHFA’s supervised entities fall into three main groups: Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System.^[1]

Fannie Mae and Freddie Mac are shareholder-owned, federally chartered government-sponsored enterprises. Their core function is to support mortgage-market liquidity by purchasing loans from mortgage originators and packaging loans into mortgage-backed securities. They do not originate home loans directly to consumers. Because their activities influence underwriting standards, securitization practices, guarantee fees, mortgage-credit availability, and multifamily finance, FHFA supervision can have broad market effects.

The Federal Home Loan Bank System consists of 11 regional Federal Home Loan Banks and the Office of Finance.^[1] The regional banks are cooperatives owned by their member financial institutions. They raise funds in the capital markets, principally through consolidated obligations, and use the proceeds to make advances and support housing and community-investment programs. The Office of Finance acts as the fiscal agent for the system’s consolidated debt obligations.

FHFA conducts examinations and monitoring of these entities. It also oversees Federal Home Loan Bank affordable-housing and community-investment activities, including allocations to the Affordable Housing Program, which supports affordable rental housing and down-payment assistance.^[1]

Conservatorship of Fannie Mae and Freddie Mac

FHFA’s most visible role has been its conservatorship of Fannie Mae and Freddie Mac. On September 6, 2008, with the consent of the boards of both enterprises, FHFA’s director used statutory authority to place each company into conservatorship. FHFA says the action responded to substantial deterioration in housing markets that severely damaged each enterprise’s financial condition and left both unable to fulfill their missions without government intervention.^[2]

As conservator, FHFA has powers that go beyond ordinary supervision. The agency states that it has the powers of the management, boards, and shareholders of Fannie Mae and Freddie Mac, while the enterprises continue to operate as business corporations.^[2] In practice, this means that Fannie Mae and Freddie Mac retain operating management and boards, but FHFA has ultimate authority over the enterprises’ operations and may require consultation or approval for specified decisions.^[2]

The legal standard for conservatorship is rooted in the amended Federal Housing Enterprises Financial Safety and Soundness Act of 1992. FHFA’s conservatorship history page states that, as conservator, the agency is authorized to take actions necessary to put a regulated entity into sound and solvent condition and actions appropriate to carry on the entity’s business and preserve and conserve its assets and property.^[2]

The U.S. Department of the Treasury supported the conservatorships through Senior Preferred Stock Purchase Agreements with Fannie Mae and Freddie Mac. FHFA says Treasury’s commitments were designed to ensure that each enterprise remained solvent and could continue providing liquidity and stability to the mortgage market despite lacking sufficient risk capital.^[2] Those agreements made the conservatorships a joint policy issue involving FHFA, Treasury, Congress, and the broader mortgage market.

FHFA initially focused the conservatorships on reducing enterprise losses, reducing operational and credit risk, and stabilizing housing and mortgage markets. After the enterprises returned to profitability, FHFA’s focus shifted toward longer-term issues, including capital, risk management, operational resilience, and housing-finance policy questions.^[2]

Supervisory and regulatory functions

FHFA’s supervisory model includes examination, monitoring, rulemaking, guidance, and enforcement. For each regulated entity, FHFA conducts regular supervision intended to evaluate safety and soundness, compliance with statutory requirements, governance, capital adequacy, risk management, and mission performance. The agency’s Performance and Accountability Report page describes the report as covering FHFA’s activities as regulator of the Federal Home Loan Bank System and as regulator and conservator of Fannie Mae and Freddie Mac over the fiscal year.^[5]

For Fannie Mae and Freddie Mac, FHFA supervision includes oversight of mortgage-credit risk, guarantee fees, single-family and multifamily business activities, counterparty risk, securitization operations, capital planning, technology, and model risk. FHFA also issues conservatorship scorecards that communicate priorities and expectations for enterprise activities.^[2]

For the Federal Home Loan Banks, FHFA supervision focuses on liquidity, advances, capital, collateral, market risk, governance, membership, consolidated-obligation funding, and mission-related activities. The system is important to depository institutions because advances can be used for mortgage funding, asset-liability management, and short-term liquidity needs.^[1]

FHFA’s authority also includes housing-mission oversight. That role requires the agency to balance safety and soundness against statutory housing-finance objectives. The agency’s decisions can affect affordable-housing support, multifamily lending, community investment, and the availability of conforming mortgage credit.

Relationship with other U.S. financial regulators

FHFA is one of several federal financial regulators with housing- or mortgage-market responsibilities. It interacts with the U.S. Department of the Treasury because of the Treasury support agreements for Fannie Mae and Freddie Mac and because Treasury chairs the Financial Stability Oversight Council. FHFA is a member agency of the Financial Stability Oversight Council, whose statutory role includes identifying risks to U.S. financial stability, promoting market discipline, and responding to emerging risks.^[1]

FHFA also operates alongside the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Consumer Financial Protection Bureau. These agencies may supervise banks, bank holding companies, consumer-finance practices, payment systems, or deposit insurance, while FHFA supervises the housing government-sponsored enterprises and Federal Home Loan Banks.

The Federal Reserve’s summary of HERA noted that Congress required consultation with the Federal Reserve chairman for certain matters involving risks posed by the government-sponsored enterprises to the financial system, including prudential standards, capital requirements, and decisions to place a GSE into conservatorship or receivership during the statutory consultation period.^[3] This reflected Congress’s view that housing GSE oversight had financial-stability implications.

Leadership and governance

FHFA is led by a director. As of the agency leadership page opened for this entry, William J. Pulte was FHFA director. FHFA states that Pulte was sworn in on March 14, 2025, as the fifth director of U.S. Federal Housing, following nomination by President Donald J. Trump and Senate confirmation.^[6]

The FHFA director oversees the agency’s regulatory, supervisory, conservatorship, and operational functions. Because FHFA’s regulated entities are large and central to housing finance, the director’s policy priorities can influence mortgage-market practices, Federal Home Loan Bank supervision, enterprise capital planning, housing goals, and conservatorship strategy.

The agency’s strategic goals, as stated on its website, are to oversee Fannie Mae and Freddie Mac, supervise the Federal Home Loan Bank System, and manage U.S. Federal Housing operations efficiently.^[1] Those goals are implemented through examinations, rules, guidance, scorecards, annual reports, research, and public data releases.

Market significance

FHFA decisions can affect lenders, mortgage investors, homebuyers, renters, insurers, and community-development institutions. For lenders, Fannie Mae and Freddie Mac standards often influence mortgage underwriting, loan documentation, servicing practices, and the pricing of conforming loans. For investors, enterprise mortgage-backed securities are a major segment of U.S. fixed-income markets. For banks and credit unions, the Federal Home Loan Banks are an important source of secured wholesale funding.

FHFA’s market significance increased after 2008 because the conservatorships put Fannie Mae and Freddie Mac under direct federal control. Although the enterprises continue to operate as corporations, FHFA’s conservator authority gives the agency a decisive role in matters that would otherwise fall to corporate boards and shareholders.^[2]

The agency’s role is also politically and economically sensitive. Housing finance affects credit access, homeownership, rental housing supply, mortgage rates, taxpayer risk, and financial stability. Changes in enterprise capital requirements, guarantee fees, loan limits, appraisal policy, credit-risk transfer programs, or Federal Home Loan Bank rules may have distributional effects across borrowers, lenders, investors, and regions.

Reporting and transparency

FHFA publishes annual reports to Congress, performance and accountability reports, data releases, research, speeches, testimony, rulemakings, orders, and conservatorship materials. Its Performance and Accountability Report series includes reports for FHFA’s fiscal-year activities and, on the page reviewed for this entry, listed a 2025 report published January 23, 2026.^[5]

The agency also publishes information on conservatorship draws and dividends related to Treasury support for Fannie Mae and Freddie Mac.^[2] These disclosures are relevant to public assessment of taxpayer exposure, enterprise capital retention, and the financial relationship between the enterprises and Treasury.

Distinction from Fannie Mae, Freddie Mac, and the Federal Home Loan Banks

FHFA should not be confused with the entities it regulates. Fannie Mae and Freddie Mac are government-sponsored enterprises that operate in mortgage purchase, guarantee, and securitization markets. The Federal Home Loan Banks are cooperatively owned regional institutions that provide secured funding to members. FHFA is the federal regulator and, for Fannie Mae and Freddie Mac, the conservator.^[1][2]

This distinction is important for understanding accountability. Operational decisions may be made by the enterprises or Federal Home Loan Banks, but FHFA sets supervisory expectations and, where applicable, exercises conservatorship approval authority. Conversely, FHFA does not itself issue consumer mortgages, buy homes, insure bank deposits, or conduct monetary policy.

See also

- Federal National Mortgage Association - U.S. Department of the Treasury - Federal Reserve System - Board of Governors of the Federal Reserve System - Federal Deposit Insurance Corporation - Office of the Comptroller of the Currency - Consumer Financial Protection Bureau