Definition of Secondary Mortgage Market:
Secondary Market for Mortgages in Orange County:
The secondary mortgage market allows lenders and banks to sell mortgages, giving them new funds to offer more new mortgages to new borrowers – giving liquidity to the market. If banks had to keep these mortgages the full 15 or 30 years, they would quickly use up all their funds, and potential homebuyers would have a very difficult time to finding lenders that were capable of loaning them money. Many of the mortgages on the secondary market are bought by Fannie Mae and Freddie Mac. Some, but very few are packaged into mortgage backed securities, and sold to investors.