What type of mortgage market is described as being created for the purchase and sale of existing mortgages?

The secondary mortgage market is the correct choice because it is specifically designed for the purchase and sale of existing mortgages. In this market, mortgage originators (such as banks and mortgage companies) can sell loans they have issued to investors. This helps provide liquidity, allowing these financial institutions to free up capital to issue new loans. Through this process, mortgages are bundled into securities and sold to investors, which also helps spread the risk associated with mortgage lending.

The primary mortgage market, in contrast, is where new mortgages are created through direct lending to borrowers. This market involves the initial origination of loans rather than the buying and selling of existing ones. The tertiary market, while less commonly defined in this context, generally refers to more complex financial instruments or investments that involve mortgages but not specifically to the existing mortgage sales. Therefore, the secondary mortgage market is fundamentally about the trading of already existing mortgage loans, making it the correct answer.