Fannie Mae and Freddie Mac Beat Expectations in Third-Quarter 2026 Results
Key Facts
Fannie Mae reported results on October 28 and Freddie Mac on October 29 for the third quarter ended September 30, 2026, with net income of $4.2 billion and $3.2 billion, respectively. Fannie Mae reported revenue of $7.7 billion, while Freddie Mac recorded revenue of $6.8 billion. Fannie Mae’s net income rose from $3.9 billion in the same period of 2025, while Freddie Mac’s net income increased 17% year over year and its revenue rose 19%. The disclosures present actual results and year-over-year comparisons, without citing analyst estimates that would allow the claim that the companies beat expectations. The figures place the two institutions at the center of U.S. housing finance, with differences in their earnings drivers and risk provisions.
At Fannie Mae, net income increased $318 million from the third quarter of 2025. The company attributed the increase mainly to a $617 million rise in fair-value gains and a $344 million increase in revenue. The impact of these two factors was partly offset by an $802 million increase in the credit-loss provision. In the same quarter, the company recorded a provision of $694 million for its single-family business and $446 million for its multifamily business. It said the increase in the multifamily reserve was linked to weaker credit indicators, a decline in near-term property-value expectations and higher interest rates.
At Freddie Mac, growth in net interest income in the single-family segment was one of the results’ drivers. That income reached $5.3 billion for the quarter, up $247 million, or 5%, from the year-earlier period, driven by growth in the mortgage portfolio. Non-interest income was $933 million, up $649 million from the third quarter of 2025. The chief financial officer said the increase was mainly linked to interest-rate changes and risk-management activities. Meanwhile, the company’s credit-loss provision rose to $800 million from $175 million a year earlier; the company attributed the provision mainly to building reserves for single-family loans amid higher mortgage-rate expectations and new loan purchases, despite stable current portfolio performance.
Interest-rate movements reflect divergent pressures on mortgage activity. Fannie Mae said rates rose significantly throughout the third quarter, with the largest increases at the end of the quarter as markets reassessed the economic growth outlook and the level of interest rates needed to contain inflation. It said higher rates tend to reduce loan-purchase volumes, but also slow prepayments and the runoff of book balances, helping preserve guarantee revenue. At the same time, they can extend loans’ exposure to credit losses and weigh on prices, values and new business volumes in the multifamily segment. Freddie Mac said the mortgage rate was 7.03% at the end of the quarter, its highest level since the start of the year.
The effects of the rate environment appeared in Freddie Mac’s multifamily business: new business in the segment totaled $16 billion in the third quarter, compared with $25 billion in the same period of 2025. The company attributed the decline mainly to higher mortgage rates. Across the housing market, home prices rose 0.5% during the quarter, compared with a 0.2% increase in the third quarter of the previous year. Freddie Mac provided $114 billion in funding liquidity during the quarter and financed 420,000 homes and rental units. Its mortgage portfolio totaled $3.7 trillion on September 30.
Fannie Mae’s net worth was $119.6 billion on September 30, up $10.6 billion since December 31, 2025. The company attributed the increase in the first nine months of the year to net income of $11.9 billion, partly offset by $1.3 billion in other comprehensive loss. Freddie Mac’s net worth was $81 billion on September 30, according to its results announcement. The Fannie Mae comparison here is not year over year; it measures the change since the end of 2025, while the available data do not establish a year-over-year comparison for either company’s net worth. Fannie Mae is a shareholder-owned, government-backed institution that has been in conservatorship since 2008; it buys mortgage loans from lenders and issues securities backed by them, but does not lend directly to borrowers.
For market support this year, Fannie Mae said it had provided $344 billion in liquidity to the mortgage market from the start of 2026 through the results announcement. It added that it had helped about 1.2 million families, including more than 295,000 first-time homebuyers. These figures provide a measure separate from net worth, describing financing provided and families served rather than the source of changes in capital. Looking ahead, Freddie Mac’s forecasts assume home-price growth of 1.3% over the next twelve months, followed by 1.5% over the subsequent twelve months. The company’s earnings releases page did not specify when its next quarterly results would be published.