The Federal Home Loan Mortgage Corp., known as Freddie Mac, is a government sponsored enterprise (GSE) that purchases residential mortgages and mortgage-related securities in the secondary market and securitizes them to sell to investors. Freddie, along with sister GSE Federal National Mortgage Association, known as Fannie Mae, has enjoyed an implicit government guarantee of its debt which enabled them to borrow at rates below those available to competitors. The two mortgage giants own or guarantee nearly half of all U.S. home mortgages.
Amid the credit crisis, the federal government put Freddie and Fannie into conservatorship to prevent their potential bankruptcy. The government is wrestling with what their roles should be in the U.S. home mortgage market and a new business model. TARP pay czar has the final say on pay and the Federal Housing Finance Administration approve major inititatives. Adding to their uncertain outlook, the embattled government-sponsored enterprises are facing the prospect of steeper funding costs in 2010 when the Federal Reserve Board is expected to stop buying GSE mortgage-backed securities and debt. Freddie is now on its sixth CEO in six years: Charles "Ed" Haldeman Jr., the former chairman of Putnam Investment Management LLC, who joined in 2009.
The McLean, Va.-based company has won kudos as an employee-friendly workplace for its cutting-edge flexible-schedule policies, extensive leadership development programs and other perks.
.