“And why should I care?”
To the average homeowner, they’ve never had to think about who (or what) Fannie or Freddie for that matter is. Now that Fannie is all over the news, (i.e. the Fed Bailout) everyone’s talking about her.
First of all, her name isn’t really Fannie, and it’s not Fannie Mae either. It’s actually Federal National Mortgage Association. You can see where how we shortened it from the first letter of each word (F.N.M.A.) and came up with Fannie Mae.
But the question remains,
“What does Fannie do?”
I could go on and on explaining the role Fannie and Freddie play. The simplest answer is that they provide liquidity to the mortgage marketplace.
How they do this, and the roles of the Loan Originator, the Lender, the Mortgage Backed Securities, the Investors, and all the other players is a little more complicated.
The New York Times has a great image that better explains these roles than I possibly could.
Click on the image and get to know her better. Ok, get to know her as she is today. Tomorrow she might be in for an “Extreme Makeover”.
Bloomberg: Paulson Plans to Bring Fannie, Freddie Under Government Control
Wall Street Journal: U.S. Near Deal on Fannie, Freddie
Washington Post: U.S. Nears Rescue Plan For Fannie And Freddie
NY Times: U.S. Rescue Seen at Hand for 2 Mortgage Giants
LA Times: Fannie, Freddie takeover possible
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Get smarter about Mortgages with Mortgages Unzipped | Zillow® Blog
[...] you think that Fannie and Freddie are the mortgage story of the week, I hope that you’re sitting down. OK, maybe Fannie & [...]
Get smarter about Mortgages with Mortgages Unzipped | Real Estate Blog
[...] smarter about Mortgages with Mortgages Unzipped Advertise HereIf you think that Fannie and Freddie are the mortgage story of the week, I hope that you’re sitting down. OK, maybe Fannie & [...]