Essay regarding Fannie Mae

Desk of Articles

Introduction……………………………………………………………………………………….. three or more History…………………………………………………………………………………………….. 3 Business Technique and Philosophy…………………………………………………………………4 Corporate Progress and Diversity. …………………………………………………………………6 Conclusion………………………………………………………………………………………... several References…………………………………………………………………………………………8 Physique Chart 1……………………………………………………………………………………10

Fannie Mae

Fannie Mae can be described as leading mortgage company and one of the most economically successful businesses within the industry. Offered the salient features of the organization that has ended into its current standing, this kind of report offers a brief yet concise review of the corporation.

The organization began as a part of Roosevelt's New Deal, a program initiated by the onslaught of throughout the world economic depression in the 1930s and the complete fall of the housing market. Chartered by Congress since the National National Mortgage loan Association in 1938, the organization's primary mission was going to encourage possessing by providing community banks with money and ensuring the residential mortgage market is well funded by creation of your secondary mortgage loan market (Cottle 1998, Allie Mae 2004).

In 1968 Lyndon B. Johnson transformed Fannie Mae in a " federal government sponsored enterprise” (GSE) due to the company's total monopolization in the second mortgage market (Cottle 1998). Cottle clarifies that, " as a GSE, the company is definitely subject to congressional oversight and certain limitations on it is activities, nonetheless it non-etheless can be described as privately controlled, publicly traded, for-profit corporation incurred with earning money for its shareholders” (p. 18). The U. S. leader gets to have several board members, and the U. H. Treasury Section approves Fannie Mae's debt issuance. And it has approved and permitted and approved. Fannie Mae and Freddie Mac have virtually unlimited access to capital, at money costs which have been below the costs otherwise available. In layman's terms, therefore Fannie will not have to sign-up securities together with the government, they cannot have to pay state or regional income taxes, and because the government beneficiaries the corporation, they are seen as a government entity if they really are not which has accounted for the large financial growth in the organization's background along with a nearly limitless channel to capital (Mckinley 1998).

As was mentioned recently, the company principal goal is to assure the non commercial mortgage market is well financed. Indeed, in the past thirty-one years, Fannie Mae provides provided above $2. almost eight trillion of mortgage loans (PR Reports 2000) and has helped over 63 million family members obtain their very own dream of running a home (Fannie Mae 2006). You cannot just call up Fannie Mae and inquire its financial loan officers about the going rate on a seven-year PROVIDE; it doesn't mortgage money to retail residence buyers. Rather, it provides fluidity for lenders by providing fluid in the secondary mortgage marketplace. Fannie does this by purchasing home loans from primary lenders, that can be banks or thrifts, permitting these loan providers to finance more mortgages and then bundles the debts and resells them. A lender is definitely any organization or person that loans a borrower funds. There are a number of types of lending organizations, including educational lenders, commercial lenders, hard money lenders, sub-prime lenders, and community credit unions.

Normally a loan is usually brokered, meaning that the lender is assessed by a thirdparty who after that proposes the money request to a number of different lenders. These lenders are chosen based on all their likelihood of taking the particular borrower, and may work out small changes in the terms to attract the debtor if they will find he desirable.

A hard money lender specializes in short-term loans which can be backed generally with real estate property as collateral. A hard funds lender generally offers more serious rates than a traditional bank organization, as a swap for more flexible terms and a wider...

References: Twelve-monthly Report. (2003). Fannie Mae. Retrieved 03 28, 3 years ago from http://www.fanniemae.com/ir/pdf/annualreport/2003/2003annualreport.pdf

Allie Mae

Career Builder. (2006). Fannie Mae careers. Retrieved Drive 28, 2007 from

http://www.careerbuilder.com/JobSeeker/Companies/CompanyJobResults.aspx?Comp_DID=C37NC75JNJKDCBJD5T&cbRecursionCnt=1&cbsid=4525fce561ac4f6faa36b96c12959154-202825595-S2-1

Cottle, M. (1998, June). Nice job if you can get it: How Fannie Mae became Washington 's biggest power player. Wa Monthly. 30(6), 18-20

Fannie Mae

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