What are Fannie Mae and Freddie Mac, and what do they do?
” Fannie Mae and Freddie Mac are “government-sponsored enterprises” (GSEs). This means that they are privately owned, but receive support from the Federal Government, and assume some public responsibilities. The GSEs provide a secondary market in home mortgages, purchasing mortgages from the lenders who originate them. They hold some of these mortgages, and some are “securitized” — sold in the form of securities which the GSEs guarantee. The two GSEs today are among the largest corporations in the world.
