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Press Release

Fannie Mae to Pass-Through Principal Curtailments on Certain Single-Family Loans in MBS

November 29, 2006

Janis Smith


WASHINGTON, DC -- Fannie Mae (FNM/NYSE) today announced it will pass-through full prepayments of principal that represent repurchases of 614 mortgage loans from 330 single-family Mortgage-Backed Securities (MBS) pools. Fannie Mae will reflect the prepayment activity in its December 2006 Pool Factors and will pass-through the principal prepayments on the December distribution date for these pools.

One of Fannie Mae's seller/servicers notified the company that it delivered certain mortgage loans into Fannie Mae MBS pools that did not meet Fannie Mae's underwriting guidelines. This notification and the company's confirmation of the deficiencies triggered the repurchases.

Of the MBS pools affected, 209 have been re-securitized into 1,204 Fannie Mae Mega, 367 REMIC, and 32 SMBS transactions. There were nine Mega, eight REMIC, and two SMBS transactions impacted greater than 1 percent of the security balance. For a complete list of the affected MBS pools, including any Mega, REMIC, and SMBS transactions impacted greater than 1 percent, see the attached list.

If you are an investor in any of the Fannie Mae securities listed on the attachment and you have further questions, please contact Fannie Mae's Fixed-Income Investor Marketing at 1-800-237-8627.

Fannie Mae is a New York Stock Exchange Company. It operates pursuant to a federal charter. Fannie Mae has pledged through its American Dream Commitment to expand access to homeownership for millions of first-time home buyers; help raise the minority homeownership rate to 55 percent; make homeownership and rental housing a success for millions of families at risk of losing their homes; and expand the supply of affordable housing where it is needed most.