Abstract
The U.S. Government's influence is large in many areas and the financial sector is no exception. This article provides a brief overview of two Government Sponsored Entities (GSEs) that dominate the market for mortgages in the United States: The Federal National Mortgage Association, better known as Fannie Mae (or just Fannie), and the Federal Home Loan Mortgage Corporation, or Freddie Mac (Freddie). Fannie and Freddie are among the largest issuers of any stripe—government or private— and among the most highly visible. To carry out their stated mission to support the housing market, they issue debt to buy mortgages, which they hold in their own portfolios, and they buy mortgages from originators to bundle for sale as mortgage-backed securities (MBS). Together they securitize about half of all mortgages in the United States.
- © 2008 Pageant Media Ltd
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