A Conventional loan is simply not a Government loan. Conventional loans comply with guidelines established by Fannie Mae or Freddie Mac. Fannie Mae, the Federal National Mortgage Association and Freddie Mac, the Federal Home Loan Mortgage Corporation, are publicly traded government-sponsored enterprises (GSEs). They buy mortgage loans originated by lenders, secularize, pool and sell them to investors in the open market as mortgage-backed securities. These are often the best option for borrowers with a strong credit history and who are able to put down a larger down payment.