FANNIE MAE: Reports $2.5 Billion Net Income for Second Quarter

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Federal National Mortgage Association filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting net income of $2.54 billion on $27.29 billion of total interest income for the three months ended June 30, 2020, compared to net income of $3.43 billion on $30.28 billion of total interest income for the three months ended June 30, 2019.

For the six months ended June 30, 2020, the Company reported net income of $3 billion on $56.71 billion of total interest income compared to net income of $5.83 billion on $60.92 billion of total interest income for the same period in 2019.

As of June 30, 2020, the Company had $3.76 trillion in total assets, $3.74 trillion in total liabilities, and $16.47 billion in total stockholders’ equity.

“During this time of economic uncertainty, Fannie Mae is a force for stability, affordability, and liquidity in the housing markets. In the second quarter, we helped hundreds of thousands of homeowners and renters get the guidance and support they needed to stay in their homes, while we delivered on record refinancing demand. Fannie Mae will continue to work with partners across the industry to fulfill our mission and our leadership role in housing finance,” Hugh R. Frater, chief executive officer, said.

Fannie Mae Response to COVID-19

In March 2020, the COVID-19 outbreak in the United States was declared a national emergency. The COVID-19 pandemic resulted in stay-at-home orders, school closures, and widespread business shutdowns across the country. Although business activity has begun to resume to varying degrees, the speed and nature of the resumption of economic activity remains highly uncertain. The COVID-19 pandemic continues to have a significant impact on Fannie Mae’s business and financial results.

Fannie Mae Response

Fannie Mae is taking a number of actions to help borrowers, renters, lenders, and its employees manage the negative impact of the COVID-19 pandemic.

Borrowers and Renters

* Fannie Mae has implemented new policies to enable the company’s single-family and multifamily loan servicers to better assist borrowers and renters impacted by COVID-19, including to:

– provide forbearance to single-family borrowers reporting they are experiencing a financial hardship due to the COVID-19 outbreak for up to 180 days, and at the borrower’s request, extend the forbearance period up to a maximum of 12 months total; approximately 972,000 single-family loans in the company’s book of business were in forbearance as of June 30, 2020;

– offer options following forbearance, including a repayment plan, payment deferral, or a loan modification that aims to maintain or reduce a borrower’s monthly payment;

– suspend foreclosures and foreclosure-related activities for single-family properties through at least Aug. 31, 2020, other than for vacant or abandoned properties;

– report as current to credit bureaus homeowners who comply with their forbearance plan and were current prior to receiving COVID-19-related forbearance and provide that no late fees are charged for homeowners in
a forbearance plan; and

– provide forbearance to multifamily borrowers experiencing a financial hardship due to the COVID-19 outbreak for up to 6 months on the condition that the borrower suspend all renter evictions for nonpayment of rent during the forbearance period, through the 120-day eviction moratorium under the CARES Act, which ended on July 25, 2020, or any longer period required by state or local law.

* Fannie Mae created the #HeretoHelp educational effort and updated the company’s website to help keep people in their homes, providing information and resources on relief options for borrowers and renters impacted by COVID-19. The website includes the Renters Resource Finder, an online tool that allows renters to enter their building address to determine whether they live in a Fannie Mae-financed property and learn what resources they can access for help. Resources include access to Fannie Mae’s Disaster Response Network, which offers free assistance to renters in Fannie Mae-financed rental properties, such as HUD-approved housing counselors that can help create a personalized action plan, offer financial coaching and budgeting, and provide other support.


* Fannie Mae provided more than $453 billion in liquidity to the single-family and multifamily mortgage markets from the beginning of March 2020 through June 2020, including more than $241 billion through the company’s whole loan conduit to support small and mid-sized lenders, including community lenders, fulfilling Fannie Mae’s mission to stabilize the housing finance market and provide liquidity, support, and access to affordable mortgage financing in all U.S. markets in all economic cycles.

* Fannie Mae limited the duration of single-family servicers’ obligations to advance principal and interest payments on delinquent loans to four months.

* Fannie Mae continues to build its digital mortgage capabilities, enabling the company to adapt quickly to lenders’ needs. In addition, the company is offering measures to help ensure lenders have the clarity and flexibility to continue to lend in a prudent and responsible manner during the COVID-19 pandemic. These measures include: offering additional methods of obtaining verbal verification of borrower employment; using the company’s digital tools to offer flexibilities related to the lender’s process for obtaining inspections and appraisals; and allowing remote online notarization options.


* Fannie Mae has taken steps to protect the safety and resiliency of its workforce. The company has required nearly all of its workforce to work remotely since mid-March and continues to assess when it will be safe for employees to return to the office.

* To date, the company’s business resiliency plans and technology systems have effectively supported its company-wide telework arrangement, allowing Fannie Mae to continue its critical function of supporting mortgage market liquidity.

* Fannie Mae offers support services and resources for employees and their families affected by COVID-19, including the company’s Employee Assistance Program that provides a helpline number to support loved ones who may not be covered otherwise.

* Fannie Mae continued to pay most contractors (e.g., cafeteria staff) and accelerated payments to identified small businesses.

A full-text copy of the Form 10-Q is available for free at:

About Fannie Mae and Freddie Mac

Federal National Mortgage Association (OTCQB: FNMA), commonly known as Fannie Mae is a government-sponsored enterprise (GSE) that was chartered by U.S. Congress in 1938 to support liquidity, stability and affordability in the secondary mortgage market, where existing mortgage-related assets are purchased and sold. Fannie Mae helps make the 30-year fixed-rate mortgage and affordable rental housing possible for millions of Americans. The Company partners with lenders to create housing opportunities for families across the country. A brother organization of Fannie Mae is the Federal Home Loan Mortgage Corporation (FHLMC), better known as Freddie Mac Freddie Mac (OTCBB: FMCC) — — was established by Congress in 1970 to provide liquidity, stability and affordability to the nation’s residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders.

About Fannie Mae’s Conservatorship and Agreements with Treasury

Fannie Mae has operated under the conservatorship of FHFA since Sept. 6, 2008. Treasury has made a commitment under a senior preferred stock purchase agreement to provide funding to Fannie Mae under certain circumstances if the company has a net worth deficit. Pursuant to this agreement and the senior preferred stock the company issued to Treasury in 2008, the conservator has declared and directed Fannie Mae to pay dividends to Treasury on a quarterly basis for every dividend period for which dividends were payable since the company entered conservatorship in 2008.

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