I don't know exactly, but through the information that I obtained and my understanding I think it goes as follows: There are five players in the transaction: 1) borrower (home buyer) 2) lender ( let's say local bank) 3) Fannie Mae 4) Government 5) Investor ( say insurance company) - borrower buys a house and borrows money from the local bank at say 6.25% (your average low interest rate) - Fannie Mae buys this loan from the bank and pays the bank .25% servicing fee for the life of the loan. So bank collects the money from the borrower, remits the payments to the FM. So bank got its money back and can make more loans, plus it has .25% revenue for the life of the loan. The bank is happy. - So FM now receives his 6.25% from the borrower, but pays the bank .25% of it, so it actually is only getting 6.00%. The thing is that FM has a line of credit with the US Treasury, so it can borrow very cheaply, say at 3%. So it can pocket the difference. - The primary role of FM (mandated by the US government) is to create a secondary market for those mortages, meaning: it has to take for e.g. 50 of $200,000 mortgages and make a $10,000,000 bond out of them and sell it to insurance company (e.g. AIG) at 4.5%. AIG will be happy to receive 4.5%. It is rather low, but the bond is backed by FM, which is backed by the government. The perceived risk is low and we know that low risk generates low returns, but it is safe. - So insurance company is happy to receive 4.5% on its safe investment. FM is happy to pay 4.5% to the insurance company, because it is receiving 6% (6.25-.25) from the borrower and it only has to pay the government back 3% and can borrow more if needed. Problem: If the borrower does not pay (and remember FM is only allowed to buy conventional loans - no adjustable rate, interest only and other creative crap) due to regular economic hardships, FM has to come with cash to service that debt to investors. Well, as of 7/11/2008 the government says that FM so far has enough cash to do so.
A Fannie Mae SAM vendor is a company that has been approved by Fannie Mae to perform work for them.
Sallie Mae is in the business of student loans while Fannie Mae is in the business of home loans.
The Mae is like May, the month.
The ticker symbol for Fannie Mae is FNM and it is traded on the New York Stock Exchange.
Mae is a creative pronunciation for Mortage Association
Fannie Mae's website is reliable, but please make sure that you are actually at the Fannie Mae website and not a phishing website. Look for the Fannie Mae logo at the left of the address bar in your browser, and make sure the name is spelled correctly in the URL (website address).
WHAT YEAR DID FANNIE MAE START?
A Fannie Mae SAM vendor is a company that has been approved by Fannie Mae to perform work for them.
The Fannie Mae Foundation no longer exists.
Fannie Mae - song - was created in 1959.
Sallie Mae is in the business of student loans while Fannie Mae is in the business of home loans.
The Mae is like May, the month.
The ticker symbol for Fannie Mae is FNM and it is traded on the New York Stock Exchange.
Mae is a creative pronunciation for Mortage Association
Spending the money he stole from the tax payers when he left fannie mae.
The term "Fannie Mae" comes from the abbreviation for the true name of Fannie Mae--the Federal National Mortgage Association (FNMA). FNMA is a government-sponsored entity. For more, see http://www.fanniemae.com/kb/index?page=home&c=aboutus
Even if Fannie Mae is guaranteeing your mortgage, it is most likely that the company servicing your account (the ones you send payments to) is the place for you to contact to see your mortgage information. Fannie Mae is in a sense an investment house.