 | Janie Carr
is a Plains Capital McAfee Mortgage home mortgage consultant, with offices at the corner of 13th and Ridge Road (7200 W. 13th, Suite 4). She has 21 years experience in the mortgage industry and is ranked among the top mortgage consultants in the Wichita area. Janie is an active member of the Wichita Area Association of Realtors and the Wichita Builders' Association. Janie is a member of the United Methodist Church. She and her family reside in Clearwater, where her children attend school. You may contact Janie at (316) 773-9500, or by e-mail at jcarr@mcafeemtg.com |
Banking & Finance
2003-04-01 12:15:00
What is Fanny Mae?
What is Fannie Mae? How do they work with home buyers?
ANSWER: Fannie Mae is part of the mortgage industry. Fannie Mae does not lend money directly to home buyers, but instead works with mortgage lenders to provide money for mortgage funds. The lenders are part of the primary mortgage market -- the place where mortgages are originated and funds are loaned to borrowers. Primary market lenders include mortgage companies, savings and loans, commercial banks, credit unions, and state and local housing finance agencies.Lenders sell mortgages into what's called the secondary market -- the place where mortgages are bought and sold by various investors. Secondary market investors include Fannie Mae, various pension funds, insurance companies, securities dealers, and other financial institutions. Once a mortgage is originated, lenders have a choice. They can either hold the mortgage in their own portfolio or they can sell the mortgages to secondary market investors, such as Fannie Mae. When lenders sell their mortgages, they replenish their funds so they can turn around and lend more money to home buyers.Fannie Mae was created by Congress in 1938 to bolster the housing industry in the aftermath of the Great Depression. At that time, Fannie Mae was part of the Federal Housing Administration (FHA) and authorized to buy only FHA-insured loans to replenish lenders' supply of money. In 1968, Fannie Mae became a private company operating with private capital on a self-sustaining basis. Its role was expanded to buy mortgages beyond traditional government loan limits, reaching out to a broader cross-section of Americans.Today, Fannie Mae operates under a congressional charter that directs them to channel their efforts into increasing the availability and affordability of homeownership for low-, moderate-, and middle-income Americans. Fannie Mae stock (FNM) is is a private, shareholder-owned company and is traded on the New York Stock Exchange and other exchanges and is part of the Standard & Poor's 500 Composite Stock Price Index.
