U.S. Government Agency Security

Categories: Tax, Bonds and Treasuries,

A security, usually a bond, issued by a U.S. government-sponsored agency. The offerings of these agencies are backed by the government, but not guaranteed by the government since the agencies are private entities. Such agencies have been set up in order to allow certain groups of people to access low cost financing e.g. students and home buyers. Some prominent issuers of agency securities are student loan marketing association (sallie mae), federal national mortgage association (fannie mae) and federal home loan mortgage corporation (freddie mac). agency securities are usually exempt from state and local taxes, but not federal tax. also called agency security.