Fannie Mae and Freddie Mac both
A) sell bonds to investors and use the funds to purchase mortgages.
B) help regulate the banking system.
C) directly lend funds to people seeking mortgages.
D) reduce access to funds for mortgages by purchasing existing mortgages.

Question

Quizplus · Accepted Answer

Fannie Mae and Freddie Mac are government-sponsored enterprises that purchase mortgages from banks and other lenders, package them into securities, and sell those securities to investors. This helps increase the amount of funds available for mortgage lending, as lenders are able to sell their mortgages to Fannie Mae and Freddie Mac and use the funds to make new loans.

Fannie Mae and Freddie Mac Both