Fannie Mae FAQs What are the benefits of a Fannie Mae loan? Fannie Mae loans offer several benefits to borrowers. These include lower down payments (as low as 3%), fixed-rate and adjustable-rate mortgages, more lenient eligibility requirements, and access to special loan programs such as HomeReady and HomeStyle mortgages. What would happen if Fannie Mae did not exist? Without Fannie Mae, the availability and affordability of mortgages for many people would be drastically reduced. Fannie Mae serves as a secondary market for mortgage loans, providing lenders with more liquidity to lend without having to keep mortgage loans on their books. Without this secondary market, borrowers could have difficulty finding mortgages from traditional lenders, leading to higher interest rates or less favorable loan terms. What is the difference between Fannie Mae and Freddie Mac? Fannie Mae and Freddie Mac are government-sponsored enterprises (GSE) tasked with helping increase access to mortgages by providing liquidity in the housing market. They differ mainly in where they source their mortgages: Fannie Mae from large commercial banks and Freddie Mac from smaller community banks and credit unions. What are Fannie Mae's requirements? To qualify for a Fannie Mae loan, borrowers must meet specific criteria, including a good credit score, demonstrating enough income to cover the mortgage payments, a competitive debt-to-income (DTI) ratio, and having sufficient funds for a down payment (if applicable). What happened to Fannie Mae in the financial crisis? During the financial crisis of 2008, Fannie Mae was delisted from the New York Stock Exchange (NYSE) and taken over by the federal government as part of a bailout package. Since then, it has been under conservatorship and is managed by the Federal Housing Finance Agency (FHFA). Despite this, Fannie Mae continues to provide liquidity in the housing market and access to mortgages for many borrowers. About the Author True Tamplin, BSc, CEPF® Facebook Linkedin Instagram Twitter Youtube True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists. True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics. To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.