A Government Sponsored Enterprise, or GSE, is any financial service corporation that is created by the U.S Congress, usually for the purpose of helping with credit flow to different targeted sectors, like agriculture, education, and home financing. These enterprises may be privately owned, but their services are largely publicized and sponsored by the government. When you start looking for new home loans Muskegon, you may find that you need to work with them to get ahead with everything. Here are a few of the ones you may come across.
Fannie Mae and Freddie Mac. These two companies were the nicknames for the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation. President Roosevelt put Fannie Mae into existence with the New Deal, and Freddie Mac expanded on it in the 1970’s. Both helped with the availability of home mortgages through local banks and the secondary housing market. In 2008, when the housing market collapsed and the mortgage market crisis occurred, both companies were going to go under. The government stepped in and gave the Treasury department and Federal Reserve guardianship over the companies.
Federal Home Loan Banks. Like Fannie Mae and Freddie Mac, these 12 banks helped with distributing monies for home mortgages to banks and credit unions for easier access and distribution. They supply monies for over 8,100 financial institutions all over the US. They are much more regulated than Fannie Mae and Freddie Mac used to be, and were not as adversely affected by the mortgage crisis.
Federal Agricultural Mortgage Corporation. As Freddie Mac was a secondary market to assist Fannie Mae, the Federal Agricultural Mortgage Corporation (also known as Farmer Mac), is the secondary market to assist the Farm Credit System. It was created in 1987 for that purpose.