By functioning as governmental agencies, they also had to be profitable and make mortgage resales possible. What Fannie Mae and Freddie Mac have in commonīoth Fannie Mae and Freddie Mac have helped make homeownership more affordable for Americans. While Fannie Mae kept its mortgages, Freddie Mac could also sell its mortgages to other organizations and entities in the secondary market. However, as opposed to Fannie Mae, Freddie Mac wasn’t limited to buying only FHA loans. government continued to guarantee its loans.įreddie Mac was established in 1970 by congress as another government agency to buy mortgages. Although this brought on stakeholders, the U.S. This meant tax dollars would no longer be used to fund the entity – but that Fannie Mae would be allowed to sell stock to the public. Its purpose was to buy Federal Housing Administration (FHA) mortgages and keep them on the books while helping average Americans make their homeownership dreams a reality.įannie Mae became a company in 1968 in another move by Congress. What they do have in common, though, is that they both assist banks in closing more loans while keeping interest rates down.įannie Mae was established as a government agency by congress in 1938 with the signing and passage of the Federal Home Loan Bank Act. Meanwhile, Freddie Mac buys mortgages from smaller thrift banks. For instance, Fannie Mae buys mortgages from large retail banks. These entities don’t only have different origins – they also differ by products and their target markets. Fannie Mae is the Federal National Mortgage Association, or FNMA, and Freddie Mac is the Federal Home Loan Mortgage Corporation, or FHLMC. How can you tell Fannie Mae (FNMA) and Freddie Mac (FHLMC) apart?įannie Mae and Freddie Mac were both established by the government to boost the housing market.
0 kommentar(er)
