Credit Risk Management

Lender quality
Lenders undergo a rigorous approval process prior to doing business with Fannie Mae and must meet ongoing net worth and operational requirements. Lenders are subject to ongoing oversight through comprehensive reviews to assess the effectiveness of their quality control procedures.

Loan quality
Loans must be underwritten in accordance with Fannie Mae guidelines. The majority of loans that we acquire are evaluated through Desktop Underwriter® (DU®), the industry's most widely used automated underwriting system. All of Fannie Mae’s single-family and condominium appraisals are assessed through Collateral Underwriter® (CU®), our proprietary appraisal risk assessment tool.

Servicing quality
Fannie Mae sets loan servicing standards, acts as Master Servicer, and provides oversight of loan servicers. We set standards for loss mitigation and borrower workout options. Our proprietary servicing tool, Servicing Management Default Underwriter™ (SMDU™), automates our servicing policies.

Property management
We conduct all property management and disposition in-house, managing one of the industry's largest real estate-owned portfolios. Our strategy is to sell non-distressed homes to owner-occupants, helping to maximize sales proceeds, stabilize neighborhoods, and preserve the value of our guaranty book.

Industry-leading processes

Learn more about how we manage credit risk.

Cutting-edge tools

Watch the videos below to learn how our innovative tools help mitigate losses throughout the loan lifecycle.