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A secondary mortgage market is where an investor, in this case the U.S. government, purchases, or re-imburses the original lender for the value of the principal so that the original lender doesn't have to wait 30 years to collect the money it is owed, and can create a new loan faster with the original principal. FNMA then packages loans together of similiar value and credit worthiness and resells them to other investors, such as pension funds, etc.  

A secondary mortgage market is where an investor, in this case the U.S. government, purchases, or re-imburses the original lender for the value of the principal so that the original lender doesn't have to wait 30 years to collect the money it is owed, and can create a new loan faster with the original principal. FNMA then packages loans together of similiar value and credit worthiness and resells them to other investors, such as pension funds, etc.  

FNMA is a [[New Deal]] agency founded in 1938 by the U.S. government which did more to benefit big [[Wall Street]] banks than the common man by allowing banks to re-lend the same money over and over again versus ordinary folks who could scarcely afford a home during the [[Great Depression]].

FNMA is a [[New Deal]] agency founded in 1938 by the U.S. government which did more to benefit big [[Wall Street]] banks than the common man by allowing banks to re-lend the same money over and over again versus ordinary folks who could scarcely afford a home during the [[Great Depression]].

 

Beginning in 1997, FNMA started guaranteeing to purchase mortgaged from loan originators on borrowers with demonstrated credit unworthiness, i.e. subprime borrowers and deadbeats. Some of these loans than were snuck in to larger packages of prime mortgages with guaranteed credit worthiness precipitating the [[2008 finincial crisis]].

Although remaining a government sponsored entity (GSE), the company began selling stock to the public in 1968. Fannie Mae has been described as middle class welfare.<ref>[http://www.bloomberg.com/news/2012-03-01/middle-class-welfare-state-invisible-by-design-commentary-by-ezra-klein.html Middle-Class Welfare State Is Invisible by Design,] Ezra Klein, ''Bloomberg'', 2012-03-01.</ref>

Although remaining a government sponsored entity (GSE), the company began selling stock to the public in 1968. Fannie Mae has been described as middle class welfare.<ref>[http://www.bloomberg.com/news/2012-03-01/middle-class-welfare-state-invisible-by-design-commentary-by-ezra-klein.html Middle-Class Welfare State Is Invisible by Design,] Ezra Klein, ''Bloomberg'', 2012-03-01.</ref>