What is the difference between Ginnie Mae, Fannie Mae and Freddie Mac?
Ginnie Mae is a self-sustaining, profitable government institution. Ginnie Mae securities are the only MBS that enjoys the full faith and credit guaranty of the U.S. government. Fannie Mae and Freddie Mac are both federally chartered corporations. In September 2008, the Government-Sponsored Enterprises (GSEs) were placed under government conservatorship. Ginnie Mae does not purchase mortgages, nor does it buy, sell or issue MBS or debt securities. Private lending institutions approved by Ginnie Mae issue the MBS for which Ginnie Mae provides a guarantee. Moreover, Ginnie Mae only securitizes federally-insured or guaranteed loans. Originally, Ginnie Mae and Fannie Mae began as one organization, known as the Federal National Mortgage Association (FNMA). However, in 1968, Congress partitioned FNMA into two entities: Fannie Mae to support the conventional market and Ginnie Mae to support the market for FHA, VA, RD and PIH loans.
Ginnie Mae is a self-sustaining, profitable, wholly-owned government corporation. Ginnie Mae securities are the only MBS that enjoys the full faith and credit guaranty of the U.S. government. Fannie Mae and Freddie Mac are both federally chartered corporations. In September 2008, the Government-Sponsored Enterprises (GSEs) were placed under government conservatorship. Fannie Mae and Freddie Mac purchase mortgages to hold in their own portfolios or to issue securities for sale to investors. Ginnie Mae does not purchase mortgages, nor does it buy, sell or issue MBS or debt securities. Private lending institutions approved by Ginnie Mae issue the MBS for which Ginnie Mae provides a guarantee. Moreover, Ginnie Mae only securitizes federally-insured or guaranteed loans. Originally, Ginnie Mae and Fannie Mae began as one organization, known as the Federal National Mortgage Association (FNMA). However, in 1968, Congress partitioned FNMA into two entities: Fannie Mae to support the conventiona
Ginnie Mae, Fannie Mae, and Freddie Mac all do substantially the same thing: work in the secondary mortgage market to improve homeownership opportunities for low-, moderate- and middle-income families. The biggest differences between the organizations have to do with their relationships to the federal government and how they were created. Ginnie Mae is the lending arm of HUD, and its securities and mortgages are backed by the federal government. The governments backing of Fannie Mae and Freddie Mac, on the other hand, is perceived rather than real. Fannie Mae originally operated under governmental control but was fully privatized in 1970. Freddie Mac is also a private company; it was chartered by Congress in 1970.
