What is an Investor?

In the mortgage industry, an investor is the company that provides the money for lenders to make mortgage loans. For example, if I package your loan and send it to one of my approved lenders, that lender has a credit line with an investor that provides them the funds to make your mortgage loan.

The two most well-known investors for conforming type loans are Fannie Mae and Freddie Mac. These investors make the rules (guidelines) that an underwriter must follow in order to approve a mortgage loan.

Today many different investors exist to make funds available for mortgage loans to borrowers who are credit-worthy but do not fit within the Fannie Mae and Freddie Mac guidelines.