Replies to post #292872 on Fannie Mae-No Politics (FNMA)

[Donotunderstand]

Please explain the last sentence

Fannie sells the actual mortgage (the principal and interest flow) and then guarantees it

As interest rates rise - mortgage interest rates rise and new MBS paper will have a higher return to the buyer (higher cash flow from the higher interest)

The existing MBS paper is not owned by F and F (other than in portfolio ??) ??

And would it not go down in price like any bond - and with rising interest extend in expected life (fewer refinancing of the older paper with lower rates)

so does value go up for FNMA or ? ---- or ? Does FNMA get offers to buy back paper it issued and extinguish it - at a profitable margin/

you can tell I am not sure the impact on a packager of rising rates --- other than the one time RUSH to mortgages we will see as the rates inch up

[Hvp123]

http://www.bizjournals.com/washington/breaking_ground/2015/03/fannie-mae-leases-full-building-in-reston.html?ana=yahoo