Secondary Mortgage Market
The market where existing mortgage loans are bought and sold, giving lenders fresh capital to make new loans.
Quick flashcard
What does Secondary Mortgage Market mean on the Texas real estate exam?
Answer: The market where existing mortgage loans are bought and sold, giving lenders fresh capital to make new loans.
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Secondary Mortgage Market definition
The secondary mortgage market is where existing loans and mortgage-backed securities are bought, sold, or guaranteed after origination. Fannie Mae and Freddie Mac buy mortgages. Ginnie Mae guarantees timely payment on qualifying mortgage-backed securities and does not buy loans.
Secondary-market activity supplies liquidity that helps originators make more loans. The primary market, by contrast, is where lenders make loans directly to borrowers.
Source basis
Definition checked against the official sources below on .
On the exam
Exam trap
Tested in
Financing & Settlement (7 of 80 National)
From definition to recall
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