Federal National Mortgage Association

Federal National Mortgage Association

Federal National Mortgage Association, or FNMA, is another name for Fannie Mae. Fannie Mae is a shareholder-owned, federally chartered corporation that purchases mortgages, repackages them into mortgage-backed securities, and then sells those securities to investors. Fannie Mae (not the U.S. government) guarantees principal and interest payments on the securities, no matter what happens with the underlying mortgages. This activity provides funds for the mortgage industry so that more people in the U.S. can buy homes.