Which government-sponsored enterprise was created in 1970 to support the secondary mortgage market?

The Government-Sponsored Enterprise (GSE) established in 1970 to aid the secondary mortgage market is the Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac. This organization was created to provide liquidity, stability, and affordability to the housing market by purchasing mortgages from lenders. By doing so, Freddie Mac enables lenders to reinvest their money into more loans, facilitating the availability of affordable housing.

In contrast, Fannie Mae, which is also involved in the secondary mortgage market, was established earlier in 1938. Ginnie Mae, while important for the mortgage market, primarily guarantees mortgage-backed securities backed by the government and was established in 1968. The FDIC plays a different role by insuring deposits at banks and does not directly participate in the secondary mortgage market.

Freddie Mac's creation was significant in that it represented an evolution in government policies aimed at promoting homeownership and economic stability through efficient funding mechanisms in the mortgage industry.