He was the second son of Pedro III Fajardo, 5th Marquis of Los Vélez and his second wife Mariana Engracia Álvarez de Toledo y Portugal.
His maternal cousin was Manuel Joaquín Álvarez de Toledo, Count of Oropesa, and his brother in law was Juan Francisco de la Cerda, 8th Duke of Medinaceli, two key figures during the reign of Carlos II of Spain.
Furthermore, his mother, as the King's governess, enjoyed the trust of Queen Mariana of Austria and for many years was the person closest to Carlos II.
Her function as governess, together with her sympathy for Juan Everardo Nithard, made it probable that the first positions of the marquis in the administration were directly related to the influence of his mother and family at Court.
He became a key piece of the policy of economic regeneration undertaken by Oropesa, who valued the experience Don Fernando had acquired in financial affairs during his government in the Kingdom of Naples.