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Simply stated, they are agencies originally begun through acts of government and over time have evolved into huge private corporations. They still, however, have powerful lobby interests in Washington and carry considerable clout in many political arenas. The interesting thing is, unlike a private lender, even though the two groups have racked up over 2 trillion dollars in debt, which continues to grow, they are not required to keep a reserve against potential losses.
What Fannie Mae and Freddie Mac have done is give the dream of home ownership to millions of people that otherwise would not be a homeowner today...
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