Message window

Pricing Supplement Dated July 11, 2002

(To Offering Circular dated January 22, 2002)

Callable Benchmark Notes®

This Pricing Supplement relates to the Debt Securities described below (the "Notes"). You should read it together with the Offering Circular dated January 22, 2002 (the "Offering Circular"), relating to the Universal Debt Facility of the Federal National Mortgage Association ("Fannie Mae"). Unless defined below, capitalized terms have the meanings we gave to them in the Offering Circular.

The Notes, together with interest thereon, are not guaranteed by the United States and do not constitute a debt or obligation of the United States or of any agency or instrumentality thereof other than Fannie Mae.

Certain Securities Terms

1. Title: 5.50% Notes Due July 18, 2012

2. Form: Fed Book-Entry Securities

3. Specified Payment Currency

a. Interest: U.S. dollars

b. Principal: U.S. dollars

4. Aggregate Original Principal Amount: $2,000,000,000.00

5. Issue Date: July 18, 2002

6. Maturity Date: July 18, 2012

Amount Payable on the Maturity Date: 100.00% of principal amount

7. Subject to Redemption Prior to Maturity Date

__ No

X Yes; in whole or in part, at our option, on July 18, 2005 at a redemption price of 100% of the principal amount redeemed, plus accrued interest thereon to the date of redemption

8. Interest Category: Fixed Rate Securities

______________
"Callable Benchmark Notes" is a registered mark of Fannie Mae.

9. Interest

a. Frequency of Interest Payments: semiannually

b. Interest Payment Dates: the 18th day of each January and July

c. First Interest Payment Date: January 18, 2003

d. Interest rate per annum: 5.50%

Additional Information Relating to the Notes

1. Identification Number(s)

a. CUSIP: 31359MNK5

b. ISIN: US31359MNK52

c. Common Code: 15162554

2. Listing Application

__ No

X Yes: Luxembourg Stock Exchange

3. Eligibility for Stripping on the Issue Date

__ No

X Yes

X Minimum Principal Amount: $ 400,000.00

Offering

1. Pricing Date: July 11, 2002

2. Method of Distribution: X Principal __ Non-underwritten

3. Dealers Underwriting Commitment

Credit Suisse First Boston Corporation $ 400,000,000

Lehman Brothers Inc. 400,000,000

Salomon Smith Barney Inc. 400,000,000

Bear, Stearns & Co. Inc 100,000,000

Deutsche Bank Securities Inc. 100,000,000

Goldman, Sachs & Co. 100,000,000

HSBC Securities (USA) Inc. 100,000,000

J.P. Morgan Securities Inc. 100,000,000

Merrill Lynch, Pierce, Fenner & Smith Incorporated 100,000,000

Morgan Stanley & Co. Incorporated 100,000,000

UBS Warburg LLC 100,000,000

Total $ 2,000,000,000

a. Representative(s): Credit Suisse First Boston Corporation
Lehman Brothers Inc.
Salomon Smith Barney Inc.

b. Stabilizing Manager: Lehman Brothers Inc.

4. Offering Price:

X Fixed Offering Price: 99.885% of principal amount, plus accrued interest, if any, from the Settlement Date

__ Variable Price Offering

5. Dealer Purchase Price: 99.66% of principal amount

a. Concession: .09%

b. Reallowance: N/A

6. Pricing Methodology: See Annex 1

7. Supplemental Plan of Distribution: See Annex 2

Settlement

1. Settlement Date: July 18, 2002

2. Settlement Basis: delivery versus payment

3. Settlement Clearing System: U.S. Federal Reserve Banks

ANNEX 1
TO PRICING SUPPLEMENT DATED JULY 11, 2002
RELATING TO: 5.50% Notes Due July 18, 2012

Pricing Methodology

We have determined the offering price of the Notes using a valuation methodology applied to a yield curve of selected Fannie Mae noncallable Benchmark Securities (the “Curve”). The Curve is adjusted with a set of constant maturity yield adjustment spreads derived from Fannie Mae's Constant Maturity Debt Index ("CMDI"). The methodology also incorporates European swaption volatility levels provided by Tullett & Tokyo on page 19902 on Telerate and the TTKL interest rate swaption volatility data series found on the Bloomberg PROFESSIONAL service.

The maturities defining the Curve are 3-months, 6-months, 1-year, 2-years, 3-years, 4-years, 5-years, 7-years, 10-years, 20-years and 30-years. In consultation with our Callable Benchmark Notes Dealers, we define which outstanding noncallable Benchmark Security should represent each maturity point on the Curve. We expect that the 2-year, 3-year, 4-year, 5-year, 7-year, 10-year and 30-year values will be fed directly by TradeWeb LLC to Bloomberg. The 20-year maturity point is a straight line interpolation calculated by Bloomberg between the 10-year and 30-year maturity points. Since our short-term securities are not included on TradeWeb, at least once per
day, we expect to supply to Bloomberg a set of 3-month, 6-month and 1-year funding spreads that will be used in the generation of the Curve. We expect that the list of current Benchmark Securities and the 3-month, 6-month and 1-year spreads used in constructing the Curve will be accessible on Bloomberg.

The valuation methodology is expected to be available on Bloomberg to investors, dealers and other market participants for use in valuation analysis and secondary market trading of the Notes. The CMDI is available on Bloomberg, Moneyline (Telerate) and Reuters.

Although TradeWeb, Tullett & Tokyo and Bloomberg provide the information described above, they are under no obligation to provide or continue to provide such information. Neither Fannie Mae nor the Dealers will have any responsibility for the information provided by TradeWeb, Tullett & Tokyo or Bloomberg.

ANNEX 2
TO PRICING SUPPLEMENT DATED JULY 11, 2002
RELATING TO: 5.50% Notes Due July 18, 2012

SUPPLEMENTAL PLAN OF DISTRIBUTION

We will sell $2,000,000,000 principal amount of the Notes to the Dealers listed under “Offering” in this Pricing Supplement at the Dealer Purchase Price specified in this Pricing Supplement. In addition, to facilitate secondary market transactions, from time to time we may sell up to $500,000,000 principal amount of the Notes (the “Additional Notes”) in connection with agreements by Fannie Mae to repurchase the Additional Notes. The Additional Notes will be held in an account at the Federal Reserve Bank of New York. It is expected that the Additional Notes will be available for sale to approved dealers through a multiple price auction process. We expect that the results of each auction will be posted as soon as possible following the completion of each auction on Bloomberg, Telerate and Reuters. We may discontinue sales of Additional Notes at any time without notice.

This Pricing Supplement may also be used in connection with the issuance by Fannie Mae of any Additional Notes.