Federal housing regulator Bill Pulte said Fannie Mae and Freddie Mac do not directly issue Sharia-compliant mortgages, while a private Islamic home-financing company says the government-sponsored enterprises participate in its transactions as investors.
By yourNEWS Media Newsroom
Federal housing regulator Bill Pulte is drawing a distinction between issuing Sharia-compliant mortgages and investing in Islamic home-financing arrangements as questions continue over the role of Fannie Mae and Freddie Mac in such transactions.
Pulte said Thursday that the two government-sponsored enterprises do not themselves originate Sharia-compliant home loans.
He clarified to The Gateway Pundit that Fannie Mae and Freddie Mac “DON’T GIVE OUT SHARIA MORTGAGES.”
His statement was also circulated in an X post.
The distinction is significant because Guidance Residential, a private company specializing in Islamic home financing, says Fannie Mae and Freddie Mac can participate in its transactions as investors rather than as conventional mortgage lenders.
Guidance describes its financing model as “Islamic co-ownership financing.”
Under the arrangement, the company says it purchases a property together with the homebuyer rather than extending a traditional interest-bearing mortgage. The customer then progressively purchases Guidance’s ownership interest while also making payments for the use of the portion that remains under the company’s ownership.
The structure is designed to comply with Sharia principles that prohibit riba, or interest.
Guidance says its Sharia board worked with 18 law firms to construct an agreement allowing Freddie Mac to participate in the financing without buying conventional mortgage debt.
“Guidance simply brings on Freddie Mac as an additional investor,” the company states in its explanation of its relationship with Freddie Mac and Fannie Mae.
The company also states that Fannie Mae participates in certain transactions as an investor.
That arrangement has prompted scrutiny over the extent to which federally backed housing enterprises provide liquidity to the Islamic home-financing market even though they do not directly issue the products.
RealClearInvestigations reported in May 2026 that federal data showed Fannie Mae and Freddie Mac had become the principal investors in such Islamic home-financing products, supplying billions of dollars in liquidity.
Pulte had already indicated earlier this month that officials were examining the issue involving Fannie Mae and Freddie Mac, a position reflected in a separate X post.
The broader debate has also drawn criticism from organizations that have raised concerns about Sharia-compliant financial products.
The Center for Security Policy and other national security analysts have argued for years that Sharia-compliant finance can facilitate broader ideological influence or potentially intersect with material-support networks. Those claims represent the assessments of those organizations and analysts.
The practice continued through previous administrations without significant scrutiny at the highest levels of the Federal Housing Finance Agency, according to the material cited.
Pulte’s Thursday statement does not dispute that Fannie Mae or Freddie Mac may participate financially in transactions originated by private Islamic financing companies. Instead, his clarification focuses on the role the government-sponsored enterprises play: according to Pulte, they do not themselves provide Sharia-compliant mortgages to homebuyers.
That leaves the continuing federal review focused on the investment and liquidity side of the arrangement — including how Fannie Mae and Freddie Mac participate in privately structured Islamic co-ownership transactions and the extent of their exposure to that segment of the housing-finance market.
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