A Brief Explanation About Fannie Mae and Freddie Mac

Text-only Preview

Fannie Mae and Freddie Mac

Learn How to Take Advantage of
Fannie Mae Foreclosures & Freddie
Mac foreclosures

A Brief History – Fannie Mae

• Originally established in 1938
as a government-sponsored
enterprise (GSE) under
President Roosevelt’s New
Deal package, the Federal
National Mortgage
Association (FNMA, or Fannie
Mae) sought to expand the
secondary mortgage market

A Brief History – Fannie Mae

• In 1968, Fannie Mae
converted to a publically
traded company yet
retained its government
backing which gave it an
edge over other private
mortgage companies in
the industry

A Brief History – Fannie Mae

• Fannie Mae’s government
backed loan guarantees and its
ability to borrow at much lower
interest rates drew investors
and meant that it could buy the
mortgages of foreclosed
properties and other mortgages
from commercial lenders in
bulk allowing for more available
and affordable housing

A Brief History – Freddie Mac

• Freddie Mac was created in
1970 in order to provide
Fannie Mae with competition

• Also created as a GSE,
Freddie Mac enjoyed the
benefits of government
backing and borrowing at
low interest rates

Providing the American Dream
• From 1970 onward, the
secondary mortgage market
was dominated by Fannie Mae
& Freddie Mac
• As of 2008 and the beginning
of the housing collapse and
foreclosure crisis, Fannie Mae
& Freddie Mac together owned
or guaranteed roughly half of
the country’s mortgage market
worth $12 trillion

Recent Changes
• In September of 2008, both Fannie
Mae & Freddie Mac were placed into
conservatorship by the U.S.
Treasury Department

• These organizations are now under
the supervision of the FHFA, or
Federal Housing Finance Agency

• Fannie Mae & Freddie Mac are now
run much like HUD

Great Deals on Foreclosed Properties
• Taking advantage of Freddie
Mac & Fannie Mae
foreclosures is an excellent
way to attain great deals and
save money on foreclosure
homes and properties

• Savings of up to 50% of a
home’s appraised value are
common and these great deals
are available to anyone

How It Works

• Most homes which Fannie Mae &
Freddie Mac have participated on
revert back to them when foreclosed
• Their foreclosed homes are then
turned over to real estate agents who
provide a “Broker’s Price Opinion”
and repair recommendations
• Certified appraisers provide
valuations of the properties
• The properties are placed on the
market via a silent auction

Fannie Mae & Freddie Mac Properties
• These properties can be difficult to
locate, therefore listing services are the
best ways in which to find these great

• Listing services allow you to browse,
cull and prioritize potential interests

• Because many listing services contain
up-to-date information on foreclosure
sales, an advantage can be gained in
locating fast selling properties