v3.25.2
Fair Value
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Fair Value
We use fair value measurements for the initial recording of certain assets and liabilities and periodic remeasurement of certain assets and liabilities on a recurring or nonrecurring basis.
Fair Value Measurement
Fair value measurement guidance defines fair value, establishes a framework for measuring fair value and sets forth disclosures around fair value measurements. This guidance applies whenever other accounting guidance requires or permits assets or liabilities to be measured at fair value. The guidance establishes a three-level fair value hierarchy that prioritizes the inputs into the valuation techniques used to measure fair value as follows:
•Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities.
•Level 2: Limited observable inputs or observable inputs for similar assets and liabilities.
•Level 3: Unobservable inputs.
We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. See “Note 16, Fair Value” in our 2024 Form 10-K for information on the valuation control processes and the valuation techniques we use for fair value measurement and disclosure as well as our basis for classifying these measurements as Level 1, Level 2 or Level 3 of the valuation hierarchy in more specific situations. If the inputs used to measure assets or liabilities at fair value change, it may also result in a change in classification between Levels 1, 2, and 3. We made no material changes to the valuation control processes or the valuation techniques for the six months ended June 30, 2025.
Recurring Changes in Fair Value
The following tables display our assets and liabilities measured in our condensed consolidated balance sheets at fair value on a recurring basis subsequent to initial recognition, including instruments for which we have elected the fair value option.
Fair Value Measurements as of June 30, 2025
Quoted Prices in Active Markets for Identical Assets (Level 1)
Significant Other Observable Inputs
(Level 2)
Significant Unobservable Inputs
(Level 3)
Netting Adjustment(1)
Estimated Fair Value
(Dollars in millions)
Recurring fair value measurements:
Assets:
Trading securities:
Mortgage-related$— $1,160 $25 $— $1,185 
Non-mortgage-related(2)
75,788 19 — — 75,807 
Total trading securities75,788 1,179 25 — 76,992 
Available-for-sale securities:
Agency(3)
— 35 289 — 324 
Other mortgage-related— 4 110 — 114 
Total available-for-sale securities— 39 399 — 438 
Mortgage loans— 4,516 376 — 4,892 
Derivative assets— 561 47 (403)205 
Total assets at fair value$75,788 $6,295 $847 $(403)$82,527 
Liabilities:
Long-term debt:
Of Fannie Mae$— $78 $249 $— $327 
Of consolidated trusts— 15,204 101 — 15,305 
Total long-term debt— 15,282 350 — 15,632 
Derivative liabilities— 1,759 14 (1,480)293 
Total liabilities at fair value$— $17,041 $364 $(1,480)$15,925 
Fair Value Measurements as of December 31, 2024
Quoted Prices in Active Markets for Identical Assets (Level 1)
Significant Other Observable Inputs
(Level 2)
Significant Unobservable Inputs
(Level 3)
Netting Adjustment(1)
Estimated Fair Value
(Dollars in millions)
Recurring fair value measurements:
Assets:
Trading securities:
Mortgage-related$— $1,070 $28 $— $1,098 
Non-mortgage-related(2)
77,610 20 — — 77,630 
Total trading securities77,610 1,090 28 — 78,728 
Available-for-sale securities:
Agency(3)
— 38 301 — 339 
Other mortgage-related— 4 126 — 130 
Total available-for-sale securities— 42 427 — 469 
Mortgage loans— 3,345 399 — 3,744 
Derivative assets— 487 54 (362)179 
Total assets at fair value$77,610 $4,964 $908 $(362)$83,120 
Liabilities:
Long-term debt:
Of Fannie Mae$— $136 $249 $— $385 
Of consolidated trusts— 13,188 104 — 13,292 
Total long-term debt— 13,324 353 — 13,677 
Derivative liabilities— 2,506 15 (2,367)154 
Total liabilities at fair value$— $15,830 $368 $(2,367)$13,831 
(1)Derivative contracts are reported on a gross basis by level. The netting adjustment represents the effect of the legal right to offset under legally enforceable master netting arrangements to settle with the same counterparty on a net basis, including cash collateral posted and received.
(2)Primarily consists of U.S. Treasury securities.
(3)Agency securities consist of securities issued by Fannie Mae, Freddie Mac, or Ginnie Mae.
The following tables display a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Trading SecuritiesAvailable-for-Sale SecuritiesMortgage LoansNet DerivativesLong-term Debt
(Dollars in millions)
Balance as of March 31, 2025
$26 $405 $388 $35 $(364)
Purchases— — — — — 
Sales— — — — — 
Issuances— — — — — 
Settlements— (17)(13)18 2 
Net transfers— — 1 — — 
Total gains (losses) realized & unrealized(1)
(1)11 — (20)12 
Balance as of June 30, 2025
$25 $399 $376 $33 $(350)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Trading SecuritiesAvailable-for-Sale SecuritiesMortgage LoansNet DerivativesLong-term Debt
(Dollars in millions)
Balance as of December 31, 2024
$28 $427 $399 $39 $(353)
Purchases— — — — — 
Sales— — — — — 
Issuances— — — — — 
Settlements— (36)(29)19 6 
Net transfers(3)— (1)— — 
Total gains (losses) realized & unrealized(1)
— 8 7 (25)(3)
Balance as of June 30, 2025
$25 $399 $376 $33 $(350)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Trading SecuritiesAvailable-for-Sale SecuritiesMortgage LoansNet DerivativesLong-term Debt
(Dollars in millions)
Balance as of March 31, 2024
$28 $487 $470 $69 $(387)
Purchases— — — — — 
Sales— — (2)— — 
Issuances— — — — — 
Settlements— (18)(16)25 3 
Net transfers4 (1)(23)— 1 
Total gains (losses) realized & unrealized(1)
— (7)(4)— 3 
Balance as of June 30, 2024
$32 $461 $425 $94 $(380)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Trading SecuritiesAvailable-for-Sale SecuritiesMortgage LoansNet DerivativesLong-term Debt
(Dollars in millions)
Balance as of December 31, 2023
$26 $514 $477 $77 $(385)
Purchases— — — — — 
Sales— — (6)— — 
Issuances— — — — — 
Settlements— (55)(33)29 7 
Net transfers7 (1)(10)— 1 
Total gains (losses) realized & unrealized(1)
(1)3 (3)(12)(3)
Balance as of June 30, 2024
$32 $461 $425 $94 $(380)
(1)We had no significant unrealized gains or losses related to assets and liabilities still held in either “Net income” or “Other comprehensive income (loss)” as of June 30, 2025 or June 30, 2024.
The following tables display valuation techniques and the range and the weighted average of significant unobservable inputs for our Level 3 assets and liabilities measured at fair value on a recurring basis, excluding instruments for which we have elected the fair value option. Changes in these unobservable inputs can result in significantly higher or lower fair value measurements of these assets and liabilities as of the reporting date.
Fair Value Measurements as of June 30, 2025
Fair ValueSignificant Valuation Techniques
(Dollars in millions)
Recurring fair value measurements:
Trading securities:
Mortgage-related(1)
$25 Primarily Consensus
Available-for-sale securities:
Agency(1)
$289 Consensus
Other mortgage-related110 Primarily Discounted Cash Flow, Single Vendor, and Consensus
Total available-for-sale securities$399 
Net derivatives$33 Dealer Mark and Discounted Cash Flow
Fair Value Measurements as of December 31, 2024
Fair ValueSignificant Valuation Techniques
(Dollars in millions)
Recurring fair value measurements:
Trading securities:
Mortgage-related(1)
$28 Primarily Consensus
Available-for-sale securities:
Agency(1)
$301 Consensus
Other mortgage-related126 Primarily Discounted Cash Flow, Single Vendor, and Consensus
Total available-for-sale securities$427 
Net derivatives$39 Dealer Mark and Discounted Cash Flow
(1)Includes Fannie Mae and Freddie Mac securities.
In our condensed consolidated balance sheets, certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when we evaluate loans for impairment).
The following table displays valuation techniques for our Level 3 assets measured at fair value on a nonrecurring basis.
Fair Value Measurements as of
Valuation TechniquesJune 30,
2025		December 31, 2024
(Dollars in millions)
Nonrecurring fair value measurements:
Mortgage loans:(1)
Mortgage loans held for sale, at lower of cost or fair valueConsensus$189 $113 
Single-family mortgage loans held for investment, at amortized costInternal Model270 267 
Multifamily mortgage loans held for investment, at amortized costAppraisal172 448 
Broker Price Opinion1,186 851 
Internal Model90 172 
Total multifamily mortgage loans held for investment, at amortized cost1,448 1,471 
Acquired property, net:
Single-familyAccepted Offer and Appraisal192 74 
Internal Model and Walk Forward305 294 
Total single-family497 368 
MultifamilyBroker Price Opinion and Appraisal77 278 
Total nonrecurring assets at fair value$2,481 $2,497 
(1)When we measure impairment, including recoveries, based on the fair value of the loan or the underlying collateral and impairment is recorded on any component of the mortgage loan, including accrued interest receivable and amounts due from the borrower for advances of taxes and insurance, we present the entire fair value measurement amount with the corresponding mortgage loan.
Fair Value of Financial Instruments
The following table displays the carrying value and estimated fair value of our financial instruments. The fair value of financial instruments we disclose includes commitments to purchase multifamily and single-family mortgage loans that we do not record in our condensed consolidated balance sheets. The fair values of these commitments are included as “Mortgage loans held for investment, net of allowance for loan losses.” The disclosure excludes all non-financial instruments; therefore, the fair value of our financial assets and liabilities does not represent the underlying fair value of our total consolidated assets and liabilities.
As of June 30, 2025
Carrying ValueQuoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs
(Level 3) 		Netting AdjustmentEstimated Fair Value
(Dollars in millions)
Financial assets:
Cash and cash equivalents, including restricted cash and cash equivalents
$78,552 $38,427 $40,125 $— $— $78,552 
Securities purchased under agreements to resell23,753 — 23,753 — — 23,753 
Trading securities76,992 75,788 1,179 25 — 76,992 
Available-for-sale securities438 — 39 399 — 438 
Mortgage loans held for sale393 — 102 319 — 421 
Mortgage loans held for investment, net of allowance for loan losses
4,119,738 — 3,585,154 130,751 — 3,715,905 
Advances to lenders2,211 — 2,211 — — 2,211 
Derivative assets at fair value205 — 561 47 (403)205 
Guaranty assets60 — — 148 — 148 
Total financial assets$4,302,342 $114,215 $3,653,124 $131,689 $(403)$3,898,625 
Financial liabilities:
Short-term debt:
Of Fannie Mae$11,095 $— $11,096 $— $— $11,096 
Long-term debt:
Of Fannie Mae117,221 — 119,024 603 — 119,627 
Of consolidated trusts4,082,196 — 3,645,981 261 — 3,646,242 
Derivative liabilities at fair value293 — 1,759 14 (1,480)293 
Guaranty obligations64 — — 56 — 56 
Total financial liabilities$4,210,869 $— $3,777,860 $934 $(1,480)$3,777,314 
As of December 31, 2024
Carrying ValueQuoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs
(Level 3)		Netting AdjustmentEstimated Fair Value
(Dollars in millions)
Financial assets:
Cash and cash equivalents, including restricted cash and cash equivalents$78,811 $38,536 $40,275 $— $— $78,811 
Securities purchased under agreements to resell15,975 — 15,975 — — 15,975 
Trading securities78,728 77,610 1,090 28 — 78,728 
Available-for-sale securities469 — 42 427 — 469 
Mortgage loans held for sale373 — 130 258 — 388 
Mortgage loans held for investment, net of allowance for loan losses
4,137,633 — 3,496,803 127,763 — 3,624,566 
Advances to lenders1,825 — 1,825 — — 1,825 
Derivative assets at fair value179 — 487 54 (362)179 
Guaranty assets64 — — 160 — 160 
Total financial assets$4,314,057 $116,146 $3,556,627 $128,690 $(362)$3,801,101 
Financial liabilities:
Short-term debt:
Of Fannie Mae$11,188 $— $11,193 $— $— $11,193 
Long-term debt:
Of Fannie Mae128,234 — 129,152 567 — 129,719 
Of consolidated trusts4,088,675 — 3,557,237 274 — 3,557,511 
Derivative liabilities at fair value154 — 2,506 15 (2,367)154 
Guaranty obligations69 — — 60 — 60 
Total financial liabilities$4,228,320 $— $3,700,088 $916 $(2,367)$3,698,637 
For a detailed description and classification of our financial instruments, see “Note 16, Fair Value” in our 2024 Form 10-K.
Fair Value Option
We generally elect the fair value option on a financial instrument when the accounting guidance would otherwise require us to separately account for a derivative that is embedded in an instrument at fair value. Under the fair value option, we carry this type of instrument, in its entirety, at fair value instead of separately accounting for the derivative.
Interest income for the mortgage loans is recorded in “Interest income: Mortgage loans” and interest expense for the debt instruments is recorded in “Interest expense: Long-term debt” in our condensed consolidated statements of operations and comprehensive income.
The following table displays the fair value and unpaid principal balance of the financial instruments for which we have elected the fair value option.
As of
June 30, 2025December 31, 2024
Loans(1)
Long-Term Debt of Fannie MaeLong-Term Debt of Consolidated Trusts
Loans(1)
Long-Term Debt of Fannie MaeLong-Term Debt of Consolidated Trusts
(Dollars in millions)
Fair value$4,892 $327 $15,305 $3,744 $385 $13,292 
Unpaid principal balance5,239 327 15,910 4,079 383 13,766 
(1)Includes nonaccrual loans with a fair value of $26 million and $31 million as of June 30, 2025 and December 31, 2024, respectively. Includes loans that are 90 days or more past due with a fair value of $22 million and $25 million as of June 30, 2025 and December 31, 2024, respectively.
Changes in Fair Value under the Fair Value Option Election
We recorded gains of $36 million and $161 million for the three and six months ended June 30, 2025, respectively, and losses of $2 million and $47 million for the three and six months ended June 30, 2024, respectively, from changes in the fair value of loans recorded at fair value in “Fair value gains (losses), net” in our condensed consolidated statements of operations and comprehensive income.
We recorded losses of $68 million and $379 million for the three and six months ended June 30, 2025, respectively, and gains of $17 million and $128 million for the three and six months ended June 30, 2024, respectively, from changes in the fair value of long-term debt recorded at fair value in “Fair value gains (losses), net” in our condensed consolidated statements of operations and comprehensive income.