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Current Focus

Fannie Mae closely monitors changes in housing and economic conditions and

the impact of those changes on the credit risk profile of our single-family mortgagecredit book of business and acquisitions. The single-family loans purchased orguaranteed by Fannie Mae since 2009 have solid credit profiles and strongperformance, due in part to the changes made beginning in 2008.

Fannie Mae continues to focus on:

Monitoring profile and performance of the single-family book of business and acquisitions.

Providing liquidity and support to the market.


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Credit Profile and Performance

We continue to see the positive effects of actions taken beginning in 2008 to significantly strengthen ourunderwriting and eligibility standards to promote sustainable homeownership and stability in the housingmarket.

Compared with the loans we acquired in 2005 through 2008, the loans we have acquired since January 1,2009 have had better overall credit risk profiles at the time we acquired them and their early performancehas been strong.

Weighted average LTV at Origination 73% 68%

Weighted average FICO at Origination 722 761

Fully-Amortizing Fixed Rate Loans 86% 95%

Original LTV >90% 11% 6%

FICO


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Recent Policy Changes

The current market presents many challenges and also new opportunities. We monitor the marketactivities to ensure that we are providing necessary support of market recovery and responsible financingoptions based on borrower behavior and other economic developments.

Recent PolicyChange

Driver Overview Reference

Delayed FinancingException

Support for increasedactivity in the market forcash sales.

Guidelines permitting a cash-out refinancewithin six months of a purchase transactionwhen no financing was originally obtainedfor the purchase.

SEL-2011-05

(June 28, 3011)

Resubmission toDesktop Underwriter

After Closing

Improved data integrityand flexibility forlenders.

Process for lenders to correct data withinDUafter closing to ensure the terms of theclosed loan match the terms of the final loancasefile submission in DU and/or the loanremains within established tolerances.

SEL-2011-04

(May 24, 2011)

Deferred StudentLoans

Reduction of processingdelays and alignmentwith industry practice.

Calculation of monthly payment based on2% of the balance of the student loan in lieuof obtaining documentation of repayment

terms.

SEL-2011-04

(May 24, 2011)

Qualified ParticipantsRequirements

Streamlined policy inresponse to industryfeedback.

Hiring process utilized to identify individualsnot permitted to manage or performorigination functions for loans sold to FannieMae.

SEL-2011-06

(July 26, 2011)


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Fannie Mae Contacts and Sources

Wendy Wood: [email protected] (202) 752-6747

Fannie Mae Single-Family Results:

FannieMae.com | Investors | SEC Filings | Quarterly/Annual Results | 2011 Second-QuarterResults

Announcements:

eFannieMae.com | Frequently Searched Pages - 2011 Lender Announcements and Letters
mailto:[email protected]:[email protected]

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