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FANNIE MAE & FREDDIE MAC. WHO ARE THEY?

Who Are Fannie Mae and Freddie Mac?

Posted By beth On August 31, 2011 @ 12:07 am In Today’s Home Spun Wisdom

Fannie Mae and Freddie Mac are publicly traded companies that guarantee the majority of new mortgages in the U.S. They are key players in the government’s foreclosure-prevention initiative—most notably, the Making Home Affordable program.

Fannie Mae, officially the Federal National Mortgage Association, and Freddie Mac, the Federal Home Loan Mortgage Corp., were taken over by the government in 2008 after billions of dollars in losses and years of mismanagement.

Fannie and Freddie operate in the U.S. secondary mortgage market. They don’t sell mortgages directly to homeowners; they buy mortgages from banks and other lenders, which can use the money to issue new home mortgages.

Fannie was created as a federal agency in 1938 and chartered by Congress in 1968, followed by Freddie in 1970, to increase access to home loans. But they also are publicly traded corporations and—before their taxpayer bailout—had a duty to maximize shareholder return.
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September 2, 2011 - Posted by | Buying, Foreclosures, Selling, Short Sales

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