Third Quarter 2026
Filed Oct 29, 2026Freddie Mac Reports Net Income of $3.2 Billion for Third Quarter 2026
Net income rose 17% year-over-year to $3.2 billion as net revenues increased 19% and non-interest expense declined 6%, despite a higher provision for credit losses. Both Single-Family and Multifamily reported year-over-year net-income growth.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net interest income, 3Q 2026GAAP | $5.88B | ($133 million) | $422 million |
| Interest income, 3Q 2026GAAP | $35.06B | – | – |
| Interest expense, 3Q 2026GAAP | ($29,188 million) | – | – |
| Non-interest income, 3Q 2026GAAP | $933M | $952 million | $649 million |
| Guarantee income, 3Q 2026GAAP | $213M | – | – |
| Investment gains (losses), net, 3Q 2026GAAP | $599M | – | – |
| Other income, 3Q 2026GAAP | $121M | – | – |
| Net revenues, 3Q 2026GAAP | $6.81B | $819 million | $1,071 million |
| Provision for credit losses, 3Q 2026GAAP | ($800 million) | ($1,680 million) | ($625 million) |
| Non-interest expense, 3Q 2026GAAP | ($1,994 million) | $103 million | $122 million |
| Salaries and employee benefits, 3Q 2026GAAP | ($400 million) | – | – |
| Professional services, technology, and occupancy, 3Q 2026GAAP | ($286 million) | – | – |
| Credit enhancement expense, 3Q 2026GAAP | ($422 million) | – | – |
| Legislative and regulatory assessments, 3Q 2026GAAP | ($839 million) | – | – |
| Other expense, 3Q 2026GAAP | ($47 million) | – | – |
| Income before income tax expense, 3Q 2026GAAP | $4.02B | ($758 million) | $568 million |
| Income tax expense, 3Q 2026GAAP | ($781 million) | $155 million | ($106 million) |
| Net income, 3Q 2026GAAP | $3.23B | ($603 million) | $462 million |
| Other comprehensive income (loss), net of taxes and reclassification adjustments, 3Q 2026GAAP | ($29 million) | ($38 million) | ($45 million) |
| Comprehensive income, 3Q 2026GAAP | $3.21B | ($641 million) | $417 million |
| Net income attributable to common stockholders, 3Q 2026GAAP | $29M | – | – |
| Net income per common share, 3Q 2026GAAP | $0.01 | – | – |
| Weighted average common shares, 3Q 2026GAAP | 3.23B | – | – |
| Single-Family net interest income, 3Q 2026GAAP | $5.29B | ($155 million) | $247 million |
| Single-Family non-interest income (loss), 3Q 2026GAAP | $537M | $886 million | $680 million |
| Single-Family net revenues, 3Q 2026GAAP | $5.83B | $731 million | $927 million |
| Single-Family provision for credit losses, 3Q 2026GAAP | ($685 million) | ($1,531 million) | ($567 million) |
| Single-Family non-interest expense, 3Q 2026GAAP | ($1,777 million) | $93 million | $91 million |
| Single-Family net income, 3Q 2026GAAP | $2.71B | ($563 million) | $367 million |
| Single-Family comprehensive income, 3Q 2026GAAP | $2.71B | ($575 million) | $352 million |
| Multifamily net interest income, 3Q 2026GAAP | $583M | $22 million | $175 million |
| Multifamily non-interest income (loss), 3Q 2026GAAP | $396M | $66 million | ($31 million) |
| Multifamily net revenues, 3Q 2026GAAP | $979M | $88 million | $144 million |
| Multifamily provision for credit losses, 3Q 2026GAAP | ($115 million) | ($149 million) | ($58 million) |
| Multifamily non-interest expense, 3Q 2026GAAP | ($217 million) | $10 million | $31 million |
| Multifamily net income, 3Q 2026GAAP | $521M | ($40 million) | $95 million |
| Multifamily comprehensive income, 3Q 2026GAAP | $501M | ($66 million) | $65 million |
| Single-Family new business activity, 3Q 2026other | $98B | – | – |
| Single-Family mortgage portfolio, September 30, 2026other | $3.2T | – | up 1% year-over-year |
| Single-Family serious delinquency rate, September 30, 2026other | 0.61% | – | – |
| Multifamily new business activity, 3Q 2026other | $16B | – | – |
| Multifamily mortgage portfolio, September 30, 2026other | $510B | – | up 6% year-over-year |
| Multifamily delinquency rate, September 30, 2026other | 0.58% | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Single-FamilyNet interest income was driven by continued mortgage portfolio growth; non-interest income reflected changes in interest rates in each respective period. | $5.8B | $731 million | up 19% year-over-year |
| MultifamilyNet interest income was driven by an increase in the balance of fully guaranteed securitizations in the Multifamily mortgage portfolio due to the change in Multifamily business strategy. | $1B | $88 million | up 17% year-over-year |
Capital returns
- Freddie Mac was not required to pay a dividend to Treasury on the senior preferred stock in September 2026.
- Cumulative dividend payments to Treasury were $119,680 million as of September 30, 2026.
- The senior preferred stock liquidation preference was $150,417 million as of September 30, 2026.
- The liquidation preference will increase to $153.6 billion on December 31, 2026 based on the increase in the Net Worth Amount during the third quarter of 2026.
What drove it
- Consolidated net interest income increased 8% year-over-year, driven by a higher balance of fully guaranteed securitizations in the Multifamily mortgage portfolio and continued mortgage portfolio growth in Single-Family.
- Consolidated non-interest income increased to $0.9 billion from $0.3 billion, driven by net investment gains in the third quarter of 2026 compared with net investment losses in the third quarter of 2025.
- Consolidated non-interest expense declined 6% year-over-year, driven by lower credit enhancement expense and lower salaries and employee benefits.
- Single-Family financed 286,000 mortgages. Eligible loans affordable to low- to moderate-income families were 56%, and first-time homebuyers represented 51% of new single-family home purchase loans.
- Multifamily financed 134,000 rental units, and 71% of eligible multifamily rental units financed were affordable to low-income families.
Concerns
- The consolidated provision for credit losses was $0.8 billion, compared with $0.2 billion in the third quarter of 2025, primarily due to a Single-Family credit reserve build driven by higher projected future mortgage interest rates and new acquisitions.
- Multifamily new business activity was $16 billion, down from $25 billion in the third quarter of 2025, primarily driven by the higher mortgage interest rate environment.
- The Single-Family serious delinquency rate was 0.61%, compared with 0.59% at December 31, 2025 and 0.57% at September 30, 2025.
- The Multifamily delinquency rate was 0.58%, compared with 0.44% at December 31, 2025 and 0.51% at September 30, 2025.
- Consolidated net income was $3,235 million in 3Q 2026, below $3,838 million in 2Q 2026.
What to watch
- The increase in projected future mortgage interest rates and its effect on Single-Family credit reserves.
- Multifamily credit performance deterioration and the effect of updates to the credit loss estimation process.
- The pace of Single-Family and Multifamily new business activity in the mortgage interest rate environment.
- The increase in senior preferred stock liquidation preference to $153.6 billion on December 31, 2026.
- The balance of fully guaranteed securitizations in the Multifamily mortgage portfolio under the changed business strategy.
Balance sheet and cash flow
- Cash and cash equivalents were $4,561 million at September 30, 2026, compared with $5,327 million at December 31, 2025.
- Total assets were $3,532,205 million at September 30, 2026, compared with $3,497,598 million at December 31, 2025.
- Mortgage loans held-for-investment were $3,354,872 million at September 30, 2026, compared with $3,290,066 million at December 31, 2025.
- Debt issued by consolidated trusts was $3,261,342 million at September 30, 2026, compared with $3,198,008 million at December 31, 2025.
- Short-term debt was $9,525 million at September 30, 2026, compared with $37,718 million at December 31, 2025.
- Long-term debt was $156,998 million at September 30, 2026, compared with $169,296 million at December 31, 2025.
- Total equity was $80,975 million at September 30, 2026, compared with $70,384 million at December 31, 2025.
- Remaining Treasury funding commitment was $140,162 million at September 30, 2026.
Analysis
Freddie Mac reported third-quarter 2026 net income of $3.2 billion, up 17% year-over-year, on net revenues of $6.8 billion, up 19%. Net interest income rose 8% to $5.9 billion, while non-interest income increased to $0.9 billion from $0.3 billion in the third quarter of 2025. The release attributes the revenue improvement to continued Single-Family mortgage portfolio growth, a larger balance of fully guaranteed Multifamily securitizations, and net investment gains compared with prior-year net investment losses.
Credit costs were the principal offset. The provision for credit losses was $0.8 billion, compared with $0.2 billion a year earlier, primarily reflecting a Single-Family reserve build from increased projected future mortgage interest rates and new acquisitions. Multifamily also recorded a credit reserve build attributable to overall credit performance deterioration, partly offset by a release from updates to the credit loss estimation process. Credit performance warrants attention as Single-Family serious delinquency reached 0.61% and Multifamily delinquency reached 0.58% at September 30, 2026.
Both operating segments increased earnings from the prior year. Single-Family net income was $2.7 billion, up 16%, and net revenues were $5.8 billion, up 19%. Multifamily net income was $0.5 billion, up 22%, while net revenues were $1.0 billion, up 17%; its net interest income increased 43%. Expense discipline also supported consolidated earnings, with non-interest expense down 6% year-over-year due to lower credit enhancement expense and lower salaries and employee benefits.
Business volumes were uneven. Single-Family new business activity was $98 billion, down from $99 billion, with 286,000 homes funded. Multifamily new business activity was $16 billion, down from $25 billion, with the decline attributed to the higher mortgage interest rate environment. Despite lower Multifamily new business, the Multifamily mortgage portfolio was up 6% year-over-year to $510 billion, while the Single-Family mortgage portfolio was up 1% to $3.2 trillion.
Capital continued to build under conservatorship. Net worth reached $80,975 million at September 30, 2026, and total equity was $80,975 million. Freddie Mac did not pay a September 2026 senior preferred stock dividend to Treasury, and the senior preferred stock liquidation preference was $150,417 million at quarter-end. The company stated that the liquidation preference will increase to $153.6 billion on December 31, 2026. No financial guidance was provided in the release.
Management, verbatim
Freddie Mac's team has made home possible for millions of families across the country. In the third quarter alone, we helped 420,000 families buy, refinance, or rent a home, including 106,000 first time homebuyers. We earned net income of $3.2 billion on net revenue of $6.8 billion in the third quarter. Through the first three quarters of 2026, net income has increased 34 percent compared with the same period a year ago.
Kenny Smith, CEO of Freddie Mac
Freddie Mac delivered another strong quarter, with solid earnings and a growing mortgage portfolio. With direction from U.S. Federal Housing in the third quarter, the company began accepting the use of VantageScore’s credit scoring model by all lenders and continued to support our mission of making housing more affordable across the country.
William J. Pulte, Director, U.S. Federal Housing and Chair of the Board of Directors, Freddie Mac
Not in the filing
stated, not guessed- Forward financial guidance
- Previous-period outlook for comparison
- Gross margin
- Operating cash flow
- Free cash flow
- Share repurchases
- Common-stock dividends
- GAAP diluted EPS
- Non-GAAP metrics and reconciliations
- Tax rate
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.