What is the secondary mortgage market? – David Reecher
The Secondary Mortgage Market is a market for lenders and investors to purchase and sell existing mortgages. Mortgage lenders often originate a loan to a borrower but then sell the loan to large aggregators, such as Fannie Mae and Freddie Mac. These organizations package the loans into mortgage-backed securities based on their risk level and then sell the loans to investors, who receive payments from the borrowers of the loan. This circle of funding makes more money available to lenders so they can provide more credit to borrowers.