Knowledge Focus: Fannie Mae
Fannie Mae
Fannie Mae (FNMA) is the widely used nickname for the Federal National Mortgage Association. Fannie Mae is a private, shareholder-owned company that works to make sure mortgage money is available for people in the US. They do not lend money directly to home buyers, but works with lenders to ensure the availablity of mortgage funds. 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 (FHA) insured mortgages, thereby replenishing the supply of lendable 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. Fannie Mae stock (FNM) is actively traded on the New York Stock Exchange.
