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What Is Freddie Mac?

Freddie Mac is a stockholder-owned corporation chartered by Congress [PDF 54K] in 1970 to keep money flowing to mortgage lenders in support of homeownership and rental housing. Freddie Mac purchases single-family and multifamily residential mortgages and mortgage-related securities, which it finances primarily by issuing mortgage pass through securities and debt instruments in the capital markets. By doing so, we ultimately help homeowners and renters get lower housing costs and better access to home financing.

Since the Great Depression, federal support for housing has been an enduring national public policy objective. In the late 1960s the mortgage market was unpredictable, interest rates varied widely from city to city across the country, and mortgages loans were sometimes hard to get. Neither government nor private banking interests could address the nation's housing finance needs alone. A new solution was needed.

Congress created Freddie Mac's charter [PDF 54K] in 1970, with a clear mission for us: stabilize the nation's mortgage markets and expand opportunities for homeownership and affordable rental housing.

mort·gage (môr'gĭj) pronunciation
n.
  1. A temporary, conditional pledge of property to a creditor as security for performance of an obligation or repayment of a debt.
  2. A contract or deed specifying the terms of a mortgage.
  3. The claim of a mortgagee upon mortgaged property.

tr.v., -gaged, -gag·ing, -gag·es.

  1. To pledge or convey (property) by means of a mortgage.
  2. To make subject to a claim or risk; pledge against a doubtful outcome: mortgaged their political careers by taking an unpopular stand.

[Middle English morgage, from Old French : mort, dead (from Vulgar Latin *mortus, from Latin mortuus, past participle of morī, to die) + gage, pledge (of Germanic origin).]

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