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Mortgage Glossary

Government-Sponsored Enterprise (GSE)

Mike Starr·Reviewed August 2026

A Government-Sponsored Enterprise is a federally chartered but privately owned financial institution created by Congress to improve the flow of credit in specific sectors of the economy. In housing, the key GSEs are Fannie Mae and Freddie Mac, which purchase mortgages from lenders to replenish their funds and keep credit available to borrowers across the country.