Fannie Mae

Fannie Mae, or the Federal National Mortgage Association, is a government-sponsored enterprise focused on expanding the availability of mortgage credit throughout the United States. Established in 1938 during the Great Depression, Fannie Mae plays a crucial role in the housing finance system by purchasing and guaranteeing mortgages from lenders, which are then pooled and securitized into mortgage-backed securities. By doing so, Fannie Mae provides liquidity to lenders, allowing them to issue more mortgages to prospective homeowners. The organization primarily impacts the residential mortgage market, influencing how affordable housing can be for consumers. Through its activities, Fannie Mae aims to maintain stability and affordability in the housing sector while also encouraging sustainable homeownership. Its significant presence in the secondary mortgage market also affects how financial institutions manage and distribute mortgage risk.