Fannie Mae us a private, shareholder-owned company that works to make sure mortgage money is available for people in communities all across America.  They do not lend money directly to homebuyers.  Instead, they worked with lenders to make sure they don't run out of mortgage funds, so more people can become homeowners.

Fannie Mae is the country's second largest corporation, in terms of assets.  Fannie Mae is among the largest financial service corporations in the world and one of the largest sources of financing for home mortgages in the United States.

In 1938, the Federal government established Fannie Mae to expand the flow of mortgage money by creating a secondary market.  Fannie Mae was authorized to buy Federal Housing Administration-insured mortgages, thereby replenishing the supply of money to lend to future homeowners.

Freddie Mac is a stockholder-owned corporation chartered by Congress in 1970 to keep money flowing to mortgage lenders to ensure that there was funding available for future homeowners.  Freddie Mac purchases single-family and multifamily residential mortgages.  They help homeowners and renter get lower housing costs and better access to home financing.

The mortgages that Fannie Mae and Freddie Mac purchase consists of all home mortgages that meet the requirements of the agencies, and are no larger than the largest loan.  The two corporations are allowed by law to purchase make up roughly 80 percent of conventional home loan market, non FHA or VA home loans.

Fannie Mae and Freddie Mac receive support from the government of credit lines with the US Treasury.  This along with their history mark them as having a special claim for Government assistance in the event they ever get into financial trouble. Both Fannie Mae and Freddie Mac started out as public institutions before they became privately owned.  Investors consider the notes they issue and the mortgage securities they guarantee almost as good as securities issued by the Federal Government.

The people that benefit indirectly are the potential homebuyers eligible for a conforming loan; the interest rate on that loan is about 1/4 percent lower that it would be without the two corporations, Fannie Mae and Freddie Mac.  If you are a low or low-to-moderate- income borrower and reside in an area where assistance is almost non-existent, you might find a loan through Fannie Mae or Freddie Mac.  It is unclear how many loans would not be made with the assistance of Fannie Mae and Freddie Mac.

Today both Fannie Mae and Freddie Mac are among the largest corporations in the world.