Federal Home Loan Mortgage Corp
XMUN:FHL
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Federal Home Loan Mortgage Corp
XMUN:FHL
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US |
Federal Home Loan Mortgage Corp
Federal Home Loan Mortgage Corp., better known as Freddie Mac, is a mortgage finance company that helps keep home loans flowing in the U.S. housing market. It does not usually make loans directly to homebuyers. Instead, it buys mortgages from lenders, pools them into mortgage-backed securities, and guarantees those securities for investors. Its main customers are mortgage lenders, banks, and investors in home-loan securities. Lenders use Freddie Mac to free up capital so they can keep making new mortgages. Investors buy the securities for a stream of payments backed by home loans, while Freddie Mac earns money from guarantee fees, investment income, and other mortgage-related service fees. Freddie Mac sits in the middle of the housing finance system, connecting lenders, borrowers, and capital markets. That role makes its business different from a normal bank: it does not mainly earn money by taking deposits and making loans one by one, but by packaging, guaranteeing, and supporting mortgage funding for the market.
Federal Home Loan Mortgage Corp., better known as Freddie Mac, is a mortgage finance company that helps keep home loans flowing in the U.S. housing market. It does not usually make loans directly to homebuyers. Instead, it buys mortgages from lenders, pools them into mortgage-backed securities, and guarantees those securities for investors.
Its main customers are mortgage lenders, banks, and investors in home-loan securities. Lenders use Freddie Mac to free up capital so they can keep making new mortgages. Investors buy the securities for a stream of payments backed by home loans, while Freddie Mac earns money from guarantee fees, investment income, and other mortgage-related service fees.
Freddie Mac sits in the middle of the housing finance system, connecting lenders, borrowers, and capital markets. That role makes its business different from a normal bank: it does not mainly earn money by taking deposits and making loans one by one, but by packaging, guaranteeing, and supporting mortgage funding for the market.
Net income: Freddie Mac reported $3.8 billion of net income, up 61% year over year, helped by higher net interest income, lower expenses, and a credit reserve release.
Liquidity: The company provided about $128 billion of liquidity to the U.S. housing market and said its total mortgage portfolio rose to $3.7 trillion.
Credit: Credit results were helped by an $880 million benefit for credit losses, driven mainly by a single-family reserve release tied to updated house price scenario assumptions.
Single-family: Single-family net income was $3.3 billion, with $110 billion of new business and refinance loans making up 33% of volume.
Multifamily: Multifamily net income rose to $561 million, supported by higher fully guaranteed securitizations and $18 billion of new business activity.
Capital: Net worth ended the quarter at $78 billion, up 20% year over year, while the capital deficit narrowed by $41 billion since the end of 2022.