First Funding Blog

Secondary Mortgage Market

The secondary market is essentially any transaction involving the sale or pledging of a mortgage loan asset other than the primary market transaction that created the mortgage loan asset. The secondary market is where mortgage loans and servicing rights are bought and sold between mortgage originators, mortgage aggregators and investors such as FannieMae, FreddieMac and GinnieMae. A large percentage of newly originated mortgages are sold by their originators into the secondary market thus enabling the cycling of capital relating to mortgage lending. The secondary mortgage market helps to make credit equally available to borrowers across geographical locations.