What was established in 1932 as a cooperative to finance housing in local communities?

The correct choice refers to the Federal Home Loan Banks, which were indeed established in 1932 as a cooperative system to provide liquidity to mortgage lenders throughout the United States. This cooperative was designed to support home ownership and affordable housing by creating a stable source of funding for local financial institutions, enabling them to make more mortgages available to individuals and families.

The Federal Home Loan Banks play a crucial role in ensuring that local banks have the necessary resources to offer loans to homebuyers, thus facilitating the financing of housing in communities across the nation. The establishment of this system was particularly important during the Great Depression, as it aided in stabilizing the housing market and fostering economic recovery.

In contrast, the other options refer to entities with different functions and timelines. The Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac, was established later in 1970 to expand the secondary mortgage market. The Federal Housing Finance Agency, created in 2008, serves as a regulator for Fannie Mae, Freddie Mac, and the Federal Home Loan Banks but does not directly finance housing. Lastly, the Government National Mortgage Association, or Ginnie Mae, was established in 1968 to promote access to mortgage financing through government-insured loans, but it is distinct from the cooperative