Fannie Mae

Ginnie Mae

Fannie Mae and Ginnie Mae are Private Corporations

Fannie Mae (FNMA) and Ginnie Mae (GNMA) are private corporations with a unique advantage. The largest, FNMA has become a $4.5 trillion company that pumps cheap money to primary market lenders by paying cash for the mortgages which these companies originate. Once a large quantity has been accumulated, they bundle these mortgages into Mortgage Backed Securities, (MBS), for sale through securities dealers.

To aid in their marketing is an implicit Government guarantee that investors will receive principal and interest payments regardless of what happens to the underlying mortgages. This transfers that risk effectively into the Treasury of the United States.

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