The Real Estate Encyclopedia
Freddie Mac
Category - Real Estate Glossary - Real Estate Terminology

Freddie Mac is was a stockholder-owned corporation chartered by Congress to increase the supply of funds that mortgage lenders, such as commercial banks, mortgage bankers, savings institutions and credit unions, can make available to homebuyers and multifamily investors.

Since Freddie Mac was created in 1970, it has pursued the purpose to provide a continuous and low-cost source of credit to finance America's housing by:

Making mortgage funds available whenever and wherever Americans need them by linking the worldwide capital markets to the U.S.
  • mortgage markets.
  • Providing a continuous, reliable and low-cost flow of mortgage capital to finance housing for the nation's homebuyers and renters.
  • Bringing the benefits of the market in which we operate the secondary mortgage market to families and communities across the nation;

Freddie Mac conducts its business primarily by buying mortgages from lenders, packaging the mortgages into securities and selling the securities guaranteed by Freddie Mac to investors. Mortgage lenders use the proceeds from selling loans to Freddie Mac to fund new mortgages, constantly replenishing the pool of funds available for lending to homebuyers and apartment owners. Just as stock and bond markets have put investor capital to work for corporations, the secondary mortgage market puts private investor capital to work for homebuyers and apartment owners, providing a continuous flow of affordable funds for home financing


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