Fannie Mae creates MBS supported by multifamily residential property mortgages. A pool of one or more multifamily mortgages -- which can be either fixed-rate or adjustable-rate (ARM) -- backs a multifamily MBS.

Fannie Mae offers a variety of multifamily MBS options for investors, which are detailed in this section.

In Fannie Mae's Delegated Underwriting and Servicing MBS, (MBS/DUS), we describe an MBS option that provides prepayment protection to investors. The DUS MBS offers competitive yields and liquidity, as well. An in-depth review of Fannie Mae's DUS program is described in an edition of MBSenger, which details the growth and development of Fannie Mae's DUS program over the past 20 years, highlights the MBS/DUS product and explores the performance features of these securities. The MBSenger edition also provides information on the DUS mortgage loan credit underwriting process; requirements to become and remain a DUS lender; other types of Fannie Mae multifamily MBS products; and links to specific multifamily MBS information that investors often request.

In Discount MBS (DMBS), we discuss the short-term (less than one year) MBS option that does not bear interest. DMBS are sold to investors at a discount and repaid at par upon maturity. They are also locked out for their full term, thus carrying no prepayment risk.

In MAST, we provide information on Multifamily Assured Schedule Payment Trust™ (MAST)™ securities -- which are multiple-class, call-protected securities that restructure interest and principal payments from DUS MBS into distinct classes (otherwise known as tranches). Fannie Mae guarantees to pay scheduled principal and interest to investors through to maturity regardless of any event on the underlying loans, including default, casualty, or condemnation.

In Mega, we describe a program under which investors may invest in large pools of multifamily MBS backed by smaller pools of MBS called Megas. (Single-Family MBS may also be pooled together to form a Mega.)

In the REMIC section, we provide information on the collateral backing Multifamily REMIC securities.

In the WAS REMIC section, we discuss Fannie Mae's senior/subordinated REMIC securities.

The Multifamily Structured Facilities section discusses an option that provides multifamily borrowers with both long- and short-term financing at competitive prices. These transactions use one or more pools of multifamily mortgage loans, which may be cross-collateralized and cross-defaulted as the collateral for securities. The securities may consist of fixed-rate MBS and/or DMBS.

Finally, in the Defeasance section, we discuss another option for prepayment protection. Generally, defeasance loans do not allow a borrower to voluntarily prepay a loan during all or most of its term, but do allow the borrower to elect to defease the loan and release the property from the lien prior to maturity.