Freddie Mac

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Freddie Mac (Federal Home Loan Mortgage Corporation)

A Congressionally chartered corporation that purchases residential mortgages in the secondary market from S&Ls, banks, and mortgage bankers and securities for sale in the capital markets.

Freddie Mac

Federal Home Loan Mortgage Corporation (FHLMC). A publicly-traded company chartered by the U.S. Congress to guarantee mortgages granted to low- or middle-income households. In order to do this, it buys mortgages and repackages them, selling them as mortgage-backed securities. It also maintains its own portfolio of mortgage-backed securities. It was established in 1970 to provide competition for Fannie Mae, which provides the same services and also had an implicit guarantee of federal backing. With the collapse of the housing bubble, Freddie Mac was placed in federal receivership in 2008 as a result of overexposure to this market. See also: Community Reinvestment Act, Credit Crunch.

Freddie Mac

1. A stockholder-owned corporation chartered by Congress in 1970 to help supply funds to mortgage lenders such as commercial banks, mortgage bankers, savings institutions, and credit unions that in turn make funds available to homeowners and multifamily investors. Freddie Mac purchases mortgages from lenders and then packages the mortgages into guaranteed securities that are sold to investors. The firm's common stock trades as FRE on the New York Stock Exchange. Formerly called Federal Home Loan Mortgage Corporation.
2. A security that is issued by this corporation and is secured by pools of conventional home mortgages. Holders of Freddie Macs receive a share of the interest and principal payments made by the homeowners.

Freddie Mac.

Freddie Mac is a shareholder-owned corporation that was chartered in 1970 to increase the supply of mortgage money that lenders are able to make available to homebuyers.

To do its job, Freddie Mac buys mortgages from banks and other lenders, packages them as securities, and sells the securities to investors. The money it raises by selling these bonds pays for purchasing the mortgages.

Lenders use the money they realize from selling mortgages to Freddie Mac to make additional loans. Lenders must be approved in order to participate in the program. Loans must meet Freddie Mac qualifications to be eligible for purchase.

To facilitate the lending process, Freddie Mac provides lenders with an automated underwriting tool to help them evaluate mortgage applications.

Freddie Mac guarantees the securities it issues, but the bonds aren't federal debts and aren't federally guaranteed.

Like its sister corporation Fannie Mae, Freddie Mac shares are traded on the New York Stock Exchange (NYSE).

Freddie Mac

See Federal Home Loan Mortgage Corporation.

Freddie Mac

One of two federal agencies that purchase home loans from lenders. The other is Fannie Mae.

See Secondary Mortgage Markets/Fannie Mae and Freddie Mac.

References in periodicals archive ?
In 1981 both FNMA and FHLMC initiated mortgage swap programs, buying S&L portfolios and issuing pass-through securities on exactly the same mortgages in return.
It turned FHLMC into nearly a carbon copy of FNMA, giving it exactly the same kind of board of directors and a very similar charter.
Prior to FIRREA, FHLMC had no statutory capital requirement; the Bank Board determined it as a policy matter.
In its annual reports as regulator of FNMA and FHLMC prior to legislative consideration of a new capital standard, HUD used a Depression scenario to assess capital adequacy, based on one used by Moody's to rate private mortgage insurers.
demand deposit series is obtained by subtracting the sum (GNMA __ dda + FNMA __ dda + FHLMC __ dda) from published n.
FNMA and FHLMC have established guidelines that they believe are prudent for the originating of home loans.
FNMA and FHLMC have responded to these concerns by continually revising their guidelines and by emphasizing to lenders and others that the rules are not absolute.
To expand homeownership, property rehabilitation, and rental opportunities for low- and moderate-income households, both FNMA and FHLMC have undertaken major initiatives concerning affordable housing, often in partnership with institutions such as private mortgage insurance companies, state and local governments, and various groups in the private sector.
The comparable figures for both FNMA and FHLMC were roughly 10 percent.
In 1990, the average loan backed by GNMA was $73,730, compared with 101,050 for FNMA and $100,890 for FHLMC.
However, several types of securities issued by FNMA and FHLMC are excluded from the lower risk weight and slotted in the 100 percent risk weight category.
government-sponsored agency securities, for example, FHLMC participation certificates, that qualify for a risk weight of 20 percent and conventional mortgage loans that qualify for a risk weight of 50 percent, then the security would receive the 50 percent risk weight.