A government sponsored mortgage company to help all your home mortgage issues is in fact a blessing in disguise for many existing home loan users & investors. One such enterprise is the Fannie Mae. In this article we will discuss more about Fannie Mae:
Fannie Mae stands for Federal National Mortgage Association of the USA. It is a government sponsored enterprise known as GSE. Fannie Mae was chartered by the US Congress in 1968. Fannie Mae is headquartered in Washington D.C. As it is a GSE, it became a public company in 1970 and is now publicly traded. The latest agreement with the Treasury entails Fannie Mae to get capital assistance to rectify any net worth deficiency it incurs till the year 2012.
The main objective of Fannie Mae is to provide affordable home loans to America’s middle to lower class citizens. It also provides liquidity & stability to the home mortgage market in the US. Fannie Mae deals with buying & holding loans and issues mortgage backed securities which are guaranteed. It mainly operates in the secondary loan market in the US.
Fannie Mae doesn’t directly provide home mortgage to consumers, but gives the same using mortgage brokers/partners & bankers. Fannie Mae thus makes sure that its mortgage partner has sufficient funds to provide loans to those wanting to buy a house at affordable rates.