Navy Federal Credit Union announced Tuesday that it is partnering with Freddie Mac to offer a 5/5 adjustable-rate mortgage to large institutional investors.

According to Navy Federal, the 5/5 ARM has a “history of growth and stability” with the credit union, and plans to grow the product moving forward.

And to do so, it is targeting large institutional investors with Freddie Mac’s backing, as the government-sponsored enterprise will pool the loans in mortgage-backed securities.

“This is the first time a product popular among credit unions and securitized by Freddie Mac is being marketed to large institutional investors with the direct intent of establishing a new and liquid market,” Pete Amstutz, Navy Federal’s assistant vice president, secondary marketing, said.

“This is a unique opportunity both for us at the credit union and for investors, because it comes from some of the best borrowers of any financial institution: the military and their families,” Amstutz continued.

“The 5/5 ARM is for lenders that know and understand their borrowers very well and believe in their underlying credit quality. Borrowers gravitate toward this type of ARM because they are less exposed to interest rate swings,” Amstutz added. “Navy Federal has a reputation for having some of the lowest mortgage interest rates and we know our members very well - the combination is a natural fit.”

Chris Boyle, Freddie Mac’s single-family senior vice president of sales and relationship management, said the GSE is “delighted” to work with Navy Federal on the program.

“This transaction allows Navy Federal to offer the product to additional members in the future and helps us fulfill our mission to provide liquidity to the U.S. mortgage market,” Boyle said.