That's probbaly what happened, but mortgages would originate even
without GSEs.

Yes, but nowhere near the number. The two big GSE's allowed the
banking system to accept and dispose of many, many times the number of
real estate mortgages that were being accepted.

They also codified the way mortgages contracts were being written and
handled by the banks. My very first trip on a commercial airline was
from Portland to LA to attend a conference for mortgage data
processors put on by FNMA. That was where they defined the record
formats and contents they would accept when mortgages were sold to
them. I was working for a large computer service bureau at the time.
There were bankers (mortgage sellers) and insurance company reps
(buyers of mortgages) ans well as reps from pension funds (mortgage
buyers). I was there as a rep of a mortgage payment processing
organization. The meeting was a real education on the mortgage loan
industry.

The result was every mortgage related computer system in the country
was programmed or converted to use the new formats. Rather than write
one, we bought a package written by IBM.

Paul