What Are Agency Bonds: Definition and Types

What are Agency Bonds: Definition and Types

By Kristi Waterworth – Updated Sep 8, 2025 at 11:38 PM

Key Points

Agency bonds offer higher interest rates with moderate safety, excluding Treasury-issued bonds.
Types of agency bonds include those from federal agencies and GSEs like Fannie Mae.
Investing in agency bonds can stabilize a portfolio and offer tax exemptions.

When you think about investing in bonds, you may immediately think of Treasury bonds, but they're not all the available options. Another great option is agency bonds, which are also tied to the U.S. government, although not in the same way. Read on to learn more about this investment vehicle.

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Close-up bond market trading screen with rising yields. Coupons, rates, yields and other informations are displayed. — Image source: Getty Images.

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

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