Fannie Mae
Wondering who is this Fannie Mae person that your real estate agent always mentions when the subject about mortgage is brought up?
Fannie Mae is not a person, nor a Woody Allen female character – but the way people commonly refer to The Federal National Mortgage Association (FNMA).
But, to be fair, although it is not a person, to better understand Fannie Mae definition we need to tell its story as if we were telling a person’s life:
Fannie Mae was founded as a government-sponsored enterprise in 1938 as part of Franklin Delano Roosevelt administration’s “New Deal” on the aftermath of the Great Depression. The idea behind Fannie Mae was to inject federal money into privately owned banks to finance home mortgages and raise the levels of home ownership after so many Americans had their homes foreclosed on due to defaulting because of the economical crisis. Fannie Mae was an aggressive second mortgage market supporter that connected their financial injection with the obligation of buying Federal Housing Administration (FHA) insurance. So much so, it basically held a second mortgage monopoly for over 30 years.
But with the economy re-established, The Federal National Mortgage Association has been through a lot of changes. It became a mixed-ownership corporation in the 1950s and eventually turned into a government-sponsored, publicly traded and privately held corporation spawning Ginnie Mae (Government National Mortgage Association) and the privately held corporation that kept the “Fannie Mae” name without the “Federal National Mortgage Association”.
Yes, it’s like a family, right? You have Fannie Mae, younger sister Ginnie Mae and love interest on that love-hate relationship Freddie Mac. The name of this sitcom? “The Mortgages”?
Real Estate Tips:
Find a local real estate agent to advise you on the best type of mortgage to your specific home.
Popular Mortgage Terms
A payment made after the grace period stipulated in the note, usually 10-15 days. ...
A reverse mortgage program administered by FHA. ...
A mortgage Web site that shows mortgage prices posted by participating lenders, in some cases hundreds of them. ...
The period used to calculate the monthly mortgage payment. The term is usually but not always the same as the maturity, which is the period over which the loan balance must be paid in ...
The lender's risk that, between the time a lock commitment is given to the borrower and the time the loan is closed, interest rates will rise and the lender will take a loss on selling ...
Standards imposed by lenders as conditions for granting loans, including maximum ratios of housing expense and total expense to income, maximum loan amounts, maximum loan-to-value ...
A particular combination of loan, borrower, property, and transaction characteristics that lenders use in setting prices and underwriting requirements. ...
Authorization by the lender for the borrower to pay taxes and insurance directly. This is in contrast to the standard procedure, where the lender adds a charge to the monthly mortgage ...
Interest from the day of closing to the first day of the following month. To simplify the task of loan administration, the accounting for all home loans begins as if the loan was closed ...

Have a question or comment?
We're here to help.