Fannie Mae will buy mortgage loans from the Federal Home Loan Bank of Chicago in an effort to increase liquidity and stability in the US mortgage market, the two agencies said in a joint statement on Tuesday. Fannie Mae, the largest US home funding company and which was taken over by the government last month, said it will buy 30- and 15-year fixed rate mortgage loans from FHLB Chicago's mortgage partnership finance program.
"Partnering with the Federal Home Loan Bank of Chicago helps us to fulfill our mission to provide the most support possible to the market, while prudently managing risk," Herb Allison, chief executive of Fannie Mae, said in the statement.