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WASHINGTON (Reuters) - The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae and Freddie Mac no matter how big their losses may be in the next three years.
Fannie Mae is a government-sponsored enterprise (GSE) chartered by Congress with a mission to provide liquidity, stability and affordability to the U.S. housing and mortgage markets.
Fannie Mae operates in the U.S. secondary mortgage market. Rather than making home loans directly to consumers, we work with mortgage bankers, brokers and other primary mortgage market partners to help ensure they have funds to lend to home buyers at affordable rates. We fund our mortgage investments primarily by issuing debt securities in the domestic and international capital markets.
Fannie Mae was established as a federal agency in 1938, and was chartered by Congress in 1968 as a private shareholder-owned company. On September 6, 2008, Director James Lockhart of the Federal Housing Finance Agency (FHFA) appointed FHFA as conservator of Fannie Mae. The U.S. Department of the Treasury has agreed to provide up to $200 billion in capital as needed to ensure the company continues to provide liquidity to the housing and mortgage markets.
Fannie Mae has three businesses - Single-Family, Housing and Community Development and Capital Markets - that provide services and products to lenders and a broad range of housing partners. Together, these businesses contribute to the company's chartered mission to increase the amount of funds available in order to make homeownership and rental housing more available and affordable.
Freddie Mac, one of America's biggest buyers of home mortgages, is a stockholder-owned corporation chartered by Congress in 1970 to keep money flowing to mortgage lenders in support of homeownership and rental housing. Learn more about how we make home possible.
Originally posted by Majic
Thank goodness President Obama has so much money!