Final answer:
The Federal Deposit Insurance Corporation (FDIC) is responsible for insuring lenders against losses from borrower defaults on mortgage loans and provides deposit insurance to bank depositors.
Step-by-step explanation:
The federal agency that insures lenders against loss if borrowers default on mortgage loans is the Federal Deposit Insurance Corporation (FDIC). The FDIC evaluates the financial health of banks by examining their balance sheets for asset and liability values.
The FDIC also provides deposit insurance for bank depositors, ensuring up to $250,000 per account is secured, even if a bank fails. This insurance is critical, especially during times of economic distress, such as the financial crisis where leading banks were on the brink of default.
The government's intervention by either bailing out institutions like Freddie Mac and Freddie Mae or providing financial assistance through the Home Owners' Loan Corporation prevented a complete collapse of the banking system.