What type of loans does Fannie Mae primarily purchase?

Fannie Mae primarily focuses on purchasing conventional loans that adhere to specific underwriting standards. These standards are designed to ensure that the loans are financially sound and meet criteria for creditworthiness, property appraisal, and borrower eligibility. By purchasing these loans, Fannie Mae helps to provide liquidity, affordability, and stability to the mortgage market, allowing lenders to originate more loans for homebuyers.

Conventional loans refer to those that are not insured or guaranteed by the federal government, distinguishing them from government-backed loans like FHA loans or VA loans. The adherence to specific underwriting standards means that Fannie Mae sets guidelines based on factors such as debt-to-income ratios and credit scores, ensuring that the loans have a level of risk that is manageable.

The other options point to types of loans that do not align with Fannie Mae’s mandate and operational framework. Government loans, subprime loans, and home equity loans have different characteristics and purposes that do not fit into Fannie Mae's primary focus of conventional mortgage loans.