Finance
The secondary mortgage market provides which key benefit to the primary mortgage market?
AHigher interest rates for borrowers
BLiquidity, allowing lenders to sell mortgages and use proceeds to fund new loans✓ Correct
CGovernment insurance for all loans
DReduced down payment requirements
Explanation
The secondary market (Fannie Mae, Freddie Mac, Ginnie Mae) purchases mortgages from primary market lenders, providing them with liquidity to originate new loans. This keeps mortgage capital flowing.
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