Freddie Mac

Yes. Freddie Mac has specific guidelines for self-employed individuals that allow them to qualify using tax returns and business profit-and-loss statements. In 2026, new initiatives have even modernized how lenders evaluate digital documentation and alternative credit data, making it easier for those with non-traditional income streams to achieve homeownership.

While they serve nearly identical roles today, their origins differ. Fannie Mae primarily buys loans from large commercial banks, while Freddie Mac was historically focused on smaller, community-based “thrift” banks. In the modern market, they both work to provide liquidity and stability, but they may offer slightly different specialized loan products or “niche” programs for different types of borrowers.

To help very low-income buyers (those earning 50% or less of the Area Median Income), Freddie Mac extended a special initiative through February 28, 2026. This program provides a $2,500 credit that can be used specifically toward a down payment or closing costs for Home Possible® or HomeOne® purchase transactions.

Home Possible® is a flagship program designed to make homeownership accessible for low-to-moderate-income buyers. Key features in 2026 include:

• 3% Down Payment: A lower barrier to entry than most traditional loans.

• Flexible Funding: The down payment can come from gifts, grants, or even “sweat equity.”

• Reduced Insurance: Lower mortgage insurance requirements than standard conventional loans.

Every year, Freddie Mac’s oversight body (the FHFA) adjusts the maximum amount a homebuyer can borrow for a conforming mortgage. In 2026, the baseline conforming loan limit for a single-family home increased to $832,750 in most U.S. counties. In high-cost areas, this limit can go as high as $1,249,125. If you borrow more than these amounts, your loan is considered a “jumbo” loan.

Freddie Mac is a market barometer. Its weekly Primary Mortgage Market Survey® (PMMS®) is the industry standard for tracking average interest rates. In March 2026, for example, Freddie Mac reported the average 30-year fixed-rate mortgage at approximately 6.11%. By setting the standards for which loans it will buy, Freddie Mac essentially dictates the “rules of the game” for most lenders in the U.S.

Freddie Mac was chartered by Congress in 1970 through the Emergency Home Finance Act. It was created to provide competition for its older sibling, Fannie Mae (established in 1938), and to support smaller “thrift” banks and savings and loan associations. In 1989, it became a publicly traded, shareholder-owned company. Following the 2008 financial crisis, it was placed under the conservatorship of the Federal Housing Finance Agency (FHFA), where it remains today to ensure market stability.

The FHLMC operates in the “secondary mortgage market.” Its primary job is to provide liquidity. It buys mortgages from lenders, which gives those lenders fresh cash to turn around and lend to the next homebuyer. Freddie Mac then pools these mortgages into “mortgage-backed securities” (MBS) and sells them to global investors. This cycle keeps the flow of money moving so that banks don’t run out of funds to offer new mortgages.

FHLMC stands for the Federal Home Loan Mortgage Corporation. This is the formal, legal name for the entity we colloquially call Freddie Mac. It was created by Congress to ensure a reliable and affordable supply of mortgage funds across the country.

A “Freddie Mac loan” is technically a conventional, conforming mortgage that follows the specific guidelines set by the organization. Freddie Mac does not lend money directly to you; instead, it buys these loans from the banks and credit unions that do. For a loan to be “conforming,” it must meet standards for the borrower’s credit score, debt-to-income (DTI) ratio, and the total loan amount.