Mortgage-backed securities were created when ________ began buying mortgage loans from originators and bundling them into large pools that could be traded like any other financial asset.
A) GNMA
B) FNMA
C) FHLMC
D) FNMA and FHLMC
E) GNMA and FNMA

Question

Quizplus · Accepted Answer

Mortgage-backed securities were created when both the Federal National Mortgage Association (FNMA or Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac) began buying mortgage loans from originators and bundling them into large pools that could be traded. Both organizations played pivotal roles in the development and popularization of mortgage-backed securities.

Mortgage-Backed Securities Were Created When ________ Began Buying Mortgage Loans