Final answer:
Conventional loans are the type that follow guidelines by Fannie Mae and Freddie Mac in the secondary market. These are distinct from FHA, VA, and USDA loans, which are backed by different government entities.
Step-by-step explanation:
Loans that follow guidelines established by Fannie Mae and Freddie Mac in the secondary market are called conventional loans. These entities provide a set of requirements that loans must meet to be considered 'conformable' for purchase in the secondary market, which includes certain credit, income, and down payment criteria. Unlike FHA loans, which are backed by the Federal Housing Administration, or VA loans and USDA loans which are backed by the Department of Veterans Affairs and the U.S. Department of Agriculture respectively, conventional loans are not federally insured. The federal government's involvement in the banking sector, such as modifying regulations to make home loans more accessible, can influence the dynamics of the primary and secondary loan markets.