Freddie Mac’s Profits Fall 14% In Q2 As Credit Loss Provisions Climb

Freddie Mac released its second-quarter 2025 earnings on Thursday morning, reporting net income of $2.4 billion from April through June. That marked a decrease of 14% compared to the same period last year, driven primarily by an increase in the provision for credit losses.

At the end of Q2, Freddie‘s net worth was $65 billion.

In the second quarter, the government-sponsored enterprise (GSE) posted net revenue of $5.9 billion, down 1% from Q2 2024. Net interest income climbed 8% to $5.3 billion, driven by ongoing growth in the company’s mortgage portfolio, which grew 2% annually.

Non-interest income, however, dropped 42% to $600 million, largely due to weaker results in the multifamily mortgage segment, according to Freddie’s earnings release.

Its provision for credit losses rose to $800 million, reflecting credit reserve growth in the single-family mortgage segment amid declining estimated property values and slower projected home-price growth.

During the earnings call, executive vice president and chief financial officer Jim Whitlinger said that the higher provision taken this quarter was “due to modeled and observed house-price declines and lower forecasted house-price appreciation.”

Freddie Mac’s earnings touted the financing of 264,000 mortgages in Q2 2025, with 53% of eligible loans affordable to low- to moderate-income households. That’s up from 224,000 mortgages financed in Q2 2024, with 51% of eligible loans affordable to low- and moderate-income borrowers.

Freddie also financed 99,000 rental units, up from 89,000 in the prior quarter, with 95% of eligible units affordable to low- to moderate-income borrowers. First-time homebuyers represented 53% of new single-family home purchase loans, the earnings report showed.

The value of Freddie Mac’s mortgage portfolio rose 2% from a year earlier to $3.6 trillion. The serious delinquency rate on single-family loans declined to 0.55%, while the corresponding rate for multifamily loans edged up to 0.47%.

“U.S. Federal Housing is transforming Freddie Mac, making it more efficient and effective, and improving productivity over time. We grew the business in the second quarter, with our mortgage portfolio ending at $3.6 trillion,” Bill Pulte, director of the Federal Housing Finance Agency — Freddie Mac’s regulator — said in a statement.

“Earnings for the quarter reflected that growth, as well as the reserve we added to manage our portfolio safely and soundly. The quarter’s $2.4 billion of earnings further enhanced our safety, taking Freddie Mac’s net worth to nearly $65 billion. Overall, the company served more than 360,000 homebuyers and renters in the quarter, with 53% of the homes and 95% of rental units affordable to low- and middle-class families.”

Single-family and multifamily performance

Freddie Mac’s single-family business earned $2.1 billion in the second quarter, down 8% from the same period last year. Net revenues were $5.1 billion, up 1% year over year, while net interest income was $4.9 billion, up 6% year over year, primarily driven by continued mortgage portfolio growth and lower funding costs.

The company booked $622 million in credit loss provisions, roughly double the level of a year ago, as home-price declines and slower expected appreciation prompted a building of reserves. Its single-family mortgage portfolio grew 2% to $3.1 trillion, with a serious delinquency rate of 0.55%, down from the prior quarter but up year over year.

New single-family business activity finished at $94 billion during the second quarter, more than half of which went to first-time buyers. Refinance activity accounted for about 19% of new originations.

Freddie’s multifamily segment posted $295 million in second-quarter net income, down 39% from a year earlier.

Net interest income climbed 37% to $401 million, boosted by Freddie Mac’s shift toward fully guaranteed securitizations. The company also set aside $161 million for potential loan losses, nearly double the number for Q2 2024.

The multifamily segment financed $12 billion in new business, and the corresponding portfolio value rose 4% to $466 billion. The delinquency rate rose to 0.47%, up from 0.38% a year earlier, although 97% of delinquent loans carried credit enhancements.