Freddie Mac

Federal Home Loan Mortgage Corporation, doing business as Freddie Mac, makes housing more accessible and affordable for millions of families across America by linking homeowners and renters to the world s capital markets. Primarily, Freddie Mac s customers are the primary lenders that homeowners get their loans from. These lenders extend mortgage loans directly to their customers who are purchasing or refinancing a home. The lenders then look to Freddie Mac to purchase the mortgage and replenish the primary lender s cash supply for lending. Freddie Mac funds these purchases through securitization-based financing, which means it issues a mortgage-related security that represents an undivided interest in the mortgage loans the company purchases. In this process, homeowners send their mortgage payment to the primary lender, which keeps a small fee and then sends the rest of the payment to Freddie Mac, which passes the remainder to investors who hold the company s mortgage securities. Through this unique mortgage credit system, Freddie Mac buys one mortgage every seven seconds and helps finance one in six American homes.

Fannie Mae was established in 1938 by the federal government to expand the flow of mortgage money by creating a secondary market. As a private, shareholder-owned company, it facilitates the flow of mortgage capital to increase the availability of homeownership for low-, moderate-, and middle-income Americans. Its primary market participants include mortgage companies, savings and loan associations, savings banks, commercial banks, credit unions, and state and local housing finance agencies. The company s mortgage portfolio includes mortgage loans, mortgage-related securities, and other investments purchased from lenders, securities dealers, investors, and other market participants. Its liquid investments include cash and cash equivalents, nonmortgage investments, and loans held for securitization and sale. It also shares mortgage credit risk with third parties. Daniel H. Mudd has been the chief executive officer of Fannie Mae for more than one year. He has been with the mortgage and investment company for over six years. Mudd earned a BA degree from the University of Virginia. Fannie Mae is based in Washington, D.C.