A conventional mortgage is one that is not formally backed by any government entity, but instead is available through a private lender. Many conventional loans are referred to as ‘conforming loans’ because they ‘conform’ to guidelines established by Fannie Mae and Freddie Mac. These two government-sponsored entities (GSEs) purchase loans from lenders and then sell them to investors in what are called “Mortgage Backed Securities.” By purchasing these loans, Fannie Mae and Freddie Mac free up the lender’s money so they are able to lend again, making mortgages more widely available.