Finance
In New York, the 'secondary mortgage market' consists of:
ASecond mortgage lenders who provide subordinate financing
BGovernment-sponsored enterprises (Fannie Mae, Freddie Mac) and private investors who purchase mortgage loans from original lenders, providing liquidity to the primary mortgage market✓ Correct
CSubprime lenders who make loans to borrowers with poor credit
DThe market for second-home mortgages in vacation areas
Explanation
The secondary mortgage market consists of entities — primarily Fannie Mae, Freddie Mac, and Ginnie Mae, plus private investors — that purchase mortgage loans from original lenders (banks, mortgage companies). By selling loans to the secondary market, original lenders replenish their capital to make new loans. This system provides liquidity to the mortgage market and standardizes lending practices.
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