What is the primary function of Freddie Mac?

The primary function of Freddie Mac, or the Federal Home Loan Mortgage Corporation, is to provide liquidity in the mortgage market by purchasing conventional mortgage loans. This activity helps to ensure that mortgage funds are readily available to banks and lenders, which in turn supports the overall housing market by making home financing more accessible for consumers. By purchasing these loans, Freddie Mac can bundle them into mortgage-backed securities and sell them to investors, thus injecting capital back into the market. This process stabilizes the financial environment and promotes homeownership.

In contrast, the other options presented do not align with the primary mission of Freddie Mac. Issuing bonds for state projects typically falls under the functions of municipal investment organizations rather than a secondary mortgage market entity like Freddie Mac. Providing loans for agricultural purposes is more aligned with institutions like the Farm Credit System. Finally, regulating real estate investment trusts pertains to different regulatory bodies and does not relate to the activities of Freddie Mac, which focuses specifically on mortgage financing.