Freddie Mac
Definition of "Freddie Mac"
Someone recommended you should reach out to Freddie Mac and you came here looking for him. No, he's not a registered real estate agent at The OFFICIAL Real Estate Agent Directory ®. Not a cousin to the late Bernie Mac either. Freddie Mac is more like Fannie Mae’s younger friend that helps but also disturbs. But plot twist: Freddie Mac is not actually a person! So let’s give the correct Freddie Mac definition and get this done with:
Freddie Mac is the way people commonly call the Federal Home Loan Mortgage Corporation (FHLMC), a company created to expand the second mortgage market in the US. Here’s the deal: with the success of Fannie Mae restoring the housing market after the Great Depression, it became a private corporation that needed some competition. To provide that, the US Congress created through the Emergency Home Finance act of 1970 this federally chartered corporation called Freddie Mac to buy pools of mortgages from lenders and sell securities bonds backed by these mortgages.
Freddie Mac's business model is basically keeping a fee in exchange for assuming the credit risk from investors. They don’t directly lend to borrowers; they buy specific loans allowing lenders to have space and money to lend to more clients, thus pushing for more housing development. So, as you can see, that Freddie Mac is one slick guy. He guarantees that the principal and the interest loan are paid regardless if the borrower actually pays.
If you can’t figure out which will give the best solution to your problem, check out the Fannie Mae, Freddie Mac or Ginnie Mae definition or contact a local real estate agent to look out for this one on your behalf!
Popular Mortgage Terms
An option attached to a mortgage, which allows the borrower to pay only the interest for some period. A mortgage is 'interest only' if the monthly mortgage payment does not include any ...
The period until the last payment is due. The maturity is usually but not always the same as the period used to calculate the mortgage payment. ...
A request for a loan that includes the information about the potential borrower, the property and the requested loan that the solicited lender needs to make a decision. In a narrower sense, ...
The period you must retain a mortgage in order for it to be profitable to pay points to reduce the rate. ...
Owner financing or seller financing is a trending real estate concept among homebuyers and sellers. The seller reveals in their asset’s advertising or listing if buyers can purchase ...
Fees collected by a loan officer from a borrower that are lower than the target fees specified by the lender or mortgage broker who employs the loan officer. An underage is the opposite ...
A contribution to a borrower's down payment or settlement costs made by a home seller, as an alternative to a price reduction. ...
A payment made after the grace period stipulated in the note, usually 10-15 days. ...
Acceleration Clause is a contractual provision inserted in a mortgage, a bond, a deed of trust or other credit vehicles, that gives the lender the right to demand repayment of the ...
Have a question or comment?
We're here to help.