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Press Release

Fannie Mae Shares Credit Risk with National Mortgage Insurance Corporation

October 10, 2013

Callie Dosberg


WASHINGTON, DC – Fannie Mae (FNMA/OTC) has finalized an agreement with National Mortgage Insurance Corporation ("National MI") on a transaction to provide credit risk coverage on over $5 billion in single family mortgages.  The coverage furthers the 2013 Conservatorship Scorecard goal of transferring risk to private sources of capital.  The insurance became effective as of September 1, 2013. 

"This insurance policy transfers credit risk away from taxpayers, which is an important element of creating a more sustainable housing finance system," said Andrew Bon Salle, executive vice president for underwriting, pricing and capital markets at Fannie Mae.  "We will continue working with FHFA to meet the goals of the Conservatorship Scorecard for 2013 to reduce risk for Fannie Mae and taxpayers." 

The National MI policy covers certain loans acquired by Fannie Mae in the fourth quarter of 2012, each of which had an original loan-to-value ratio (LTV) between 70 percent and 80 percent.  The terms of the policy result in Fannie Mae’s exposure on these loans being reduced to approximately 50 percent LTV, subject to a deductible amount and aggregate loss limits.

Among other provisions, the Conservatorship Scorecard for 2013 asks Fannie Mae to transfer credit risk on at least $30 billion of single-family loans that the company owns.  Additional transactions are expected this year in order to meet the goals of the Scorecard.

More information on Fannie Mae's credit risk transfer activities is available at

Fannie Mae enables people to buy, refinance, or rent a home.

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