п‚Ў With our partners, we have launched industry-wide tools and solutions to: Clarify and simplify the underwriting process пЃ± Create consistent sets of loan-level and property appraisal data пЃ± Enforce checks and balances on loans as they are delivered to us пЃ±

Supporting Sustainable Homeownership We are committed to supporting the housing recovery and helping to build a better housing finance system for the future: п‚Ў Establish and implement industry standards to help borrowers sustain homeownership пЃ± Rigorous assessment of capacity to pay: income, obligations and assets пЃ± Review of credit history backed by documented evidence пЃ± Appraisal requirements ensure comprehensive review of the collateral пѓў Borrower eligibility is only as good as the loan origination process that follows mortgages, we play a major role in setting the standards for the housing finance market. Fannie MaeвЂ™s п‚Ў Fannie Mae drives market standards through our guides, tools, data Single- Family standards, and constant engagement with our lending partners Business п‚Ў Our delegated business model relies on our rep and warrant framework accompanied by lender oversight and post-purchase quality control (QC) п‚Ў Standardization increases transparency, making it easier for participants to sell and securitize loans at competitive prices п‚Ў Fannie MaeвЂ™s comprehensive risk management approach ensures standards are updated regularly to address evolving credit issues in our acquisition standards and credit portfolio in a timely mannerДЄs the largest guarantor of U.S. Our Single-Family Business manages credit risk exposure we take when issuing MBS. п‚Ў We guarantee MBS to facilitate transactions in the TBA market, allowing mortgage lenders to hedge and/or fund their origination pipelines п‚Ў We purchase loans principally for the purpose of securitizing them Market Influence/Role in Setting Market Standards Our role is to provide liquidity to the mortgage market. mortgage market by assuming and managing credit risk. We facilitate the flow of global capital into the U.S. Mortgage Securitizations: Securitize single-family mortgage loans delivered to us by lenders into Fannie Mae MBS in lender swap transactions we assume and manage credit risk, for which we receive guaranty feesД¬redit Risk Management: Set and maintain standards for origination and servicing price and manage the credit risk on loans in our single-family guaranty book of businessД¬redit Loss Management: Work to prevent foreclosures and reduce costs of defaulted loans through foreclosure alternatives, management of foreclosures and real estate owned (REO) properties, and through pursuing contractual remedies from lenders, servicers, and providers of credit enhancementДЇannie Mae does not originate loans or lend money directly to consumers. Mortgage Acquisitions: Facilitate the purchase of single-family mortgage loans, generally for the purpose of securitizing them

There are four primary business activities of the Single-Family Credit Guaranty business: Single-Family Credit Guaranty Business Model Our mission is to provide liquidity and stability in the secondary mortgage market. Fannie Mae reserves the right to amend its policies and procedures at any time inits sole discretion.

The information contained herein is as of the date hereof. These materials are for informational purposes only and do not relate to the solicitation of any rating in relation to any security. Fannie Mae Single-Family Credit Risk Management

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