Fair Value (Tables)

6 Months Ended

Jun. 30, 2018

Recurring Changes in Fair Value [Table Text Block]

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, 2018
	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:
Cash equivalents⁽²⁾		$	498		$	—		$	—		$	—			$	498
Trading securities:
Mortgage-related securities:
Fannie Mae		—			1,617			79			—				1,696
Other agency		—			3,494			—			—				3,494
Alt-A and subprime private-label securities		—			1,430			—			—				1,430
Mortgage revenue bonds		—			—			1			—				1
Non-mortgage-related securities:
U.S. Treasury securities		35,663			—			—			—				35,663
Other securities		—			97			—			—				97
Total trading securities		35,663			6,638			80			—				42,381
Available-for-sale securities:
Mortgage-related securities:
Fannie Mae		—			1,700			204			—				1,904
Other agency		—			298			—			—				298
Alt-A and subprime private-label securities		—			623			26			—				649
Mortgage revenue bonds		—			—			506			—				506
Other		—			9			357			—				366
Total available-for-sale securities		—			2,630			1,093			—				3,723
Mortgage loans		—			8,610			1,018			—				9,628
Other assets:
Risk management derivatives:
Swaps		—			2,291			108			—				2,399
Swaptions		—			273			—			—				273
Other		—			—			20			—				20
Netting adjustment		—			—			—			(2,608		)		(2,608		)
Mortgage commitment derivatives		—			287			1			—				288
Total other assets		—			2,851			129			(2,608		)		372
Total assets at fair value		$	36,161		$	20,729		$	2,320		$	(2,608	)		$	56,602



	Fair Value Measurements as of June 30, 2018
	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)
Liabilities:
Long-term debt:
Of Fannie Mae:
Senior floating		$	—		$	7,204		$	354		$	—			$	7,558
Total of Fannie Mae		—			7,204			354			—				7,558
Of consolidated trusts		—			26,356			319			—				26,675
Total long-term debt		—			33,560			673			—				34,233
Other liabilities:
Risk management derivatives:
Swaps		—			2,466			1			—				2,467
Swaptions		—			338			—			—				338
Other		—			—			1			—				1
Netting adjustment		—			—			—			(2,756		)		(2,756		)
Mortgage commitment derivatives		—			544			10			—				554
Total other liabilities		—			3,348			12			(2,756		)		604
Total liabilities at fair value		$	—		$	36,908		$	685		$	(2,756	)		$	34,837



	Fair Value Measurements as of December 31, 2017
	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 securities:
Fannie Mae		$	—		$	2,905		$	971		$	—			$	3,876
Other agency		—			1,083			35			—				1,118
Alt-A and subprime private-label securities		—			259			194			—				453
CMBS		—			9			—			—				9
Mortgage revenue bonds		—			—			1			—				1
Non-mortgage-related securities:
U.S. Treasury securities		29,222			—			—			—				29,222
Total trading securities		29,222			4,256			1,201			—				34,679
Available-for-sale securities:
Mortgage-related securities:
Fannie Mae		—			1,911			208			—				2,119
Other agency		—			357			—			—				357
Alt-A and subprime private-label securities		—			1,237			77			—				1,314
CMBS		—			15			—			—				15
Mortgage revenue bonds		—			—			671			—				671
Other		—			10			357			—				367
Total available-for-sale securities		—			3,530			1,313			—				4,843
Mortgage loans		—			9,480			1,116			—				10,596
Other assets:
Risk management derivatives:
Swaps		—			4,035			146			—				4,181
Swaptions		—			108			—			—				108
Other		—			—			22			—				22
Netting adjustment		—			—			—			(4,272		)		(4,272		)
Mortgage commitment derivatives		—			131			1			—				132
Total other assets		—			4,274			169			(4,272		)		171
Total assets at fair value		$	29,222		$	21,540		$	3,799		$	(4,272	)		$	50,289



	Fair Value Measurements as of December 31, 2017
	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)
Liabilities:
Long-term debt:
Of Fannie Mae:
Senior floating		$	—		$	7,810		$	376		$	—			$	8,186
Total of Fannie Mae		—			7,810			376			—				8,186
Of consolidated trusts		—			29,911			582			—				30,493
Total long-term debt		—			37,721			958			—				38,679
Other liabilities:
Risk management derivatives:
Swaps		—			4,721			33			—				4,754
Swaptions		—			324			—			—				324
Other		—			—			1			—				1
Netting adjustment		—			—			—			(4,979		)		(4,979		)
Mortgage commitment derivatives		—			227			1			—				228
Total other liabilities		—			5,272			35			(4,979		)		328
Total liabilities at fair value		$	—		$	42,993		$	993		$	(4,979	)		$	39,007

__________


⁽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⁾	Cash equivalent are comprised of U.S. Treasuries that have a maturity at the date of acquisition of three months or less.

Fair Value Measurements Using Significant Unobservable Inputs (Level 3) [Table Text Block]

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). The tables also display gains and losses due to changes in fair value, including realized and unrealized gains and losses, recognized in our condensed consolidated statements of operations and comprehensive income for Level 3 assets and liabilities. When assets and liabilities are transferred between levels, we recognize the transfer as of the end of the period.



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	For the Three Months Ended June 30, 2018
																														Net Unrealized Gains (Losses) Included in Net Income Related to Assets and Liabilities Still Held as of June 30, 2018⁽⁵⁾⁽⁶⁾
				Total Gains (Losses) (Realized/Unrealized)
	Balance, March 31, 2018			Included in Net Income				Included in Total Other Comprehensive Income (Loss)⁽¹⁾			Purchases		Sales			Issues⁽³⁾		Settlements⁽³⁾			Transfers out of Level 3			Transfers into Level 3			Balance, June 30, 2018
	(Dollars in millions)
Trading securities:
Mortgage-related:
Fannie Mae	$	83		$	(5	)			$	—	$	—	$	—		$	—	$	—		$	—		$	1		$	79			$	3
Mortgage revenue bonds	1			—					—		—		—			—		—			—			—			1				—
Total trading securities	$	84		$	(5	)	⁽⁶⁾⁽⁷⁾		$	—	$	—	$	—		$	—	$	—		$	—		$	1		$	80			$	3
Available-for-sale securities:
Mortgage-related:
Fannie Mae	$	202		$	1				$	4	$	—	$	—		$	—	$	(3	)	$	—		$	—		$	204			$	—
Alt-A and subprime private-label securities	27			—					—		—		—			—		(1		)	—			—			26				—
Mortgage revenue bonds	539			(11		)			10		—		(7		)	—		(25		)	—			—			506				—
Other	351			7					10		—		—			—		(11		)	—			—			357				—
Total available-for-sale securities	$	1,119		$	(3	)	⁽⁷⁾⁽⁸⁾		$	24	$	—	$	(7	)	$	—	$	(40	)	$	—		$	—		$	1,093			$	—
Mortgage loans	$	1,102		$	11		⁽⁶⁾⁽⁷⁾		$	—	$	—	$	—		$	—	$	(79	)	$	(51	)	$	35		$	1,018			$	8
Net derivatives	133			(28		)	⁽⁶⁾		—		—		—			—		12			—			—			117				(14		)
Long-term debt:
Of Fannie Mae:
Senior floating	$	(357	)	$	3				$	—	$	—	$	—		$	—	$	—		$	—		$	—		$	(354	)		$	3
Of consolidated trusts	(462		)	4					—		—		—			—		21			177			(59		)	(319		)		(1		)
Total long-term debt	$	(819	)	$	7		⁽⁶⁾		$	—	$	—	$	—		$	—	$	21		$	177		$	(59	)	$	(673	)		$	2



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	For the Six Months Ended June 30, 2018
																															Net Unrealized Gains (Losses) Included in Net Income Related to Assets and Liabilities Still Held as of June 30, 2018⁽⁵⁾⁽⁶⁾
				Total Gains (Losses) (Realized/Unrealized)
	Balance, December 31, 2017			Included in Net Income				Included in Total Other Comprehensive Income (Loss)⁽¹⁾				Purchases⁽²⁾		Sales⁽²⁾			Issues⁽³⁾		Settlements⁽³⁾			Transfers out of Level 3			Transfers into Level 3			Balance, June 30, 2018
	(Dollars in millions)
Trading securities:
Mortgage-related:
Fannie Mae	$	971		$	166				$	—		$	1	$	(1,060	)	$	—	$	—		$	—		$	1		$	79			$	3
Other agency	35			(1		)			—			—		—			—		(1		)	(33		)	—			—				—
Alt-A and subprime private-label securities	194			(85		)			—			—		—			—		(5		)	(104		)	—			—				—
Mortgage revenue bonds	1			—					—			—		—			—		—			—			—			1				—
Total trading securities	$	1,201		$	80		⁽⁶⁾⁽⁷⁾		$	—		$	1	$	(1,060	)	$	—	$	(6	)	$	(137	)	$	1		$	80			$	3
Available-for-sale securities:
Mortgage-related:
Fannie Mae	$	208		$	1				$	—		$	—	$	—		$	—	$	(5	)	$	—		$	—		$	204			$	—
Alt-A and subprime private-label securities	77			—					(45		)	—		—			—		(2		)	(4		)	—			26				—
Mortgage revenue bonds	671			—					(3		)	—		(18		)	—		(144		)	—			—			506				—
Other	357			14					8			—		—			—		(22		)	—			—			357				—
Total available-for-sale securities	$	1,313		$	15		⁽⁷⁾⁽⁸⁾		$	(40	)	$	—	$	(18	)	$	—	$	(173	)	$	(4	)	$	—		$	1,093			$	—
Mortgage loans	$	1,116		$	28		⁽⁶⁾⁽⁷⁾		$	—		$	—	$	—		$	—	$	(127	)	$	(87	)	$	88		$	1,018			$	16
Net derivatives	134			(86		)	⁽⁶⁾		—			—		—			—		16			53			—			117				(37		)
Long-term debt:
Of Fannie Mae:
Senior floating	$	(376	)	$	22				$	—		$	—	$	—		$	—	$	—		$	—		$	—		$	(354	)		$	22
Of consolidated trusts	(582		)	7					—			—		—			1		31			331			(107		)	(319		)		(1		)
Total long-term debt	$	(958	)	$	29		⁽⁶⁾		$	—		$	—	$	—		$	1	$	31		$	331		$	(107	)	$	(673	)		$	21



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	For the Three Months Ended June 30, 2017
																															Net Unrealized Gains (Losses) Included in Net Income Related to Assets and Liabilities Still Held as of June 30, 2017⁽⁵⁾⁽⁶⁾
				Total Gains (Losses) (Realized/Unrealized)
	Balance, March 31, 2017			Included in Net Income				Included in Total Other Comprehensive Income (Loss)⁽¹⁾				Purchases⁽²⁾		Sales⁽²⁾			Issues⁽³⁾		Settlements⁽³⁾			Transfers out of Level 3			Transfers into Level 3⁽⁴⁾			Balance, June 30, 2017
	(Dollars in millions)
Trading securities:
Mortgage-related:
Fannie Mae	$	856		$	1				$	—		$	63	$	—		$	—	$	(2	)	$	(21	)	$	974		$	1,871			$	—
Alt-A and subprime private-label securities	272			3					—			—		—			—		(11		)	—			—			264				2
Mortgage revenue bonds	20			3					—			—		(21		)	—		(1		)	—			—			1				—
Total trading securities	$	1,148		$	7		⁽⁶⁾⁽⁷⁾		$	—		$	63	$	(21	)	$	—	$	(14	)	$	(21	)	$	974		$	2,136			$	2
Available-for-sale securities:
Mortgage-related:
Fannie Mae	$	232		$	—				$	(3	)	$	—	$	—		$	—	$	(2	)	$	(21	)	$	—		$	206			$	—
Alt-A and subprime private-label securities	205			—					(21		)	—		—			—		(6		)	—			—			178				—
Mortgage revenue bonds	1,185			34					(11		)	—		(312		)	—		(23		)	—			—			873				—
Other	417			—					(19		)	—		—			—		(18		)	—			—			380				—
Total available-for-sale securities	$	2,039		$	34		⁽⁷⁾⁽⁸⁾		$	(54	)	$	—	$	(312	)	$	—	$	(49	)	$	(21	)	$	—		$	1,637			$	—
Mortgage loans	$	1,149		$	24		⁽⁶⁾⁽⁷⁾		$	—		$	—	$	—		$	—	$	(55	)	$	(21	)	$	22		$	1,119			$	19
Net derivatives	113			27			⁽⁶⁾		—			—		—			—		(16		)	—			—			124				9
Long-term debt:
Of Fannie Mae:
Senior floating	$	(350	)	$	(15	)			$	—		$	—	$	—		$	—	$	—		$	—		$	—		$	(365	)		$	(14	)
Of consolidated trusts	(214		)	(5		)			—			—		—			—		12			22			(575		)	(760		)		(5		)
Total long-term debt	$	(564	)	$	(20	)	⁽⁶⁾		$	—		$	—	$	—		$	—	$	12		$	22		$	(575	)	$	(1,125	)		$	(19	)



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	For the Six Months Ended June 30, 2017
																																Net Unrealized Gains (Losses) Included in Net Income Related to Assets and Liabilities Still Held as of June 30, 2017⁽⁵⁾⁽⁶⁾
				Total Gains (Losses) (Realized/Unrealized)
	Balance, December 31, 2016			Included in Net Income				Included in Total Other Comprehensive Income (Loss)⁽¹⁾				Purchases⁽²⁾		Sales⁽²⁾			Issues⁽³⁾			Settlements⁽³⁾			Transfers out of Level 3			Transfers into Level 3⁽⁴⁾			Balance, June 30, 2017
	(Dollars in millions)
Trading securities:
Mortgage-related:
Fannie Mae	$	835		$	4				$	—		$	63	$	—		$	—		$	(5	)	$	(22	)	$	996		$	1,871			$	2
Alt-A and subprime private-label securities	271			11					—			—		—			—			(18		)	—			—			264				11
Mortgage revenue bonds	21			3					—			—		(21		)	—			(2		)	—			—			1				—
Total trading securities	$	1,127		$	18		⁽⁶⁾⁽⁷⁾		$	—		$	63	$	(21	)	$	—		$	(25	)	$	(22	)	$	996		$	2,136			$	13
Available-for-sale securities:
Mortgage-related:
Fannie Mae	$	230		$	1				$	(2	)	$	—	$	—		$	—		$	(6	)	$	(47	)	$	30		$	206			$	—
Other agency	5			—					—			—		(1		)	—			—			(4		)	—			—				—
Alt-A and subprime private-label securities	217			—					(15		)	—		—			—			(24		)	—			—			178				—
Mortgage revenue bonds	1,272			35					(12		)	—		(324		)	—			(98		)	—			—			873				—
Other	429			—					(14		)	—		—			—			(35		)	—			—			380				—
Total available-for-sale securities	$	2,153		$	36		⁽⁷⁾⁽⁸⁾		$	(43	)	$	—	$	(325	)	$	—		$	(163	)	$	(51	)	$	30		$	1,637			$	—
Mortgage loans	$	1,197		$	32		⁽⁶⁾⁽⁷⁾		$	—		$	—	$	—		$	—		$	(117	)	$	(67	)	$	74		$	1,119			$	16
Net derivatives	44			100			⁽⁶⁾		—			—		—			—			(24		)	5			(1		)	124				—
Long-term debt:
Of Fannie Mae:
Senior floating	$	(347	)	$	(18	)			$	—		$	—	$	—		$	—		$	—		$	—		$	—		$	(365	)		$	(18	)
Of consolidated trusts	(241		)	(4		)			—			—		—			(2		)	19			88			(620		)	(760		)		(4		)
Total long-term debt	$	(588	)	$	(22	)	⁽⁶⁾		$	—		$	—	$	—		$	(2	)	$	19		$	88		$	(620	)	$	(1,125	)		$	(22	)

__________


⁽¹⁾	Gains (losses) included in other comprehensive income (loss) are included in “Changes in unrealized gains on AFS securities, net of reclassification adjustments and taxes” in our condensed consolidated statements of operations and comprehensive income.


⁽²⁾	Purchases and sales include activity related to the consolidation and deconsolidation of assets of securitization trusts. For the first half of 2018, includes the dissolution of a Fannie Mae-wrapped private-label securities trust.


⁽³⁾	Issues and settlements include activity related to the consolidation and deconsolidation of liabilities of securitization trusts.

⁽⁴⁾

Transfers of Fannie Mae trading securities into Level 3 during the second quarter and first half of 2017 consisted primarily of a Fannie Mae security backed by private-label mortgage-related securities. Prices for this security were based on inputs that were not readily available. Transfers of long-term debt of consolidated trusts into Level 3 during the second quarter and first half of 2017 consisted of securities for which prices were estimated using inputs that were not readily available.


⁽⁵⁾	Amount represents temporary changes in fair value. Amortization, accretion and OTTI are not considered unrealized and are not included in this amount.


⁽⁶⁾	Gains (losses) are included in “Fair value gains (losses), net” in our condensed consolidated statements of operations and comprehensive income.


⁽⁷⁾	Gains (losses) are included in “Net interest income” in our condensed consolidated statements of operations and comprehensive income.


⁽⁸⁾	Gains (losses) are included in “Investment gains, net” in our condensed consolidated statements of operations and comprehensive income.

Valuation Techniques and Significant Unobservable Inputs for Level 3 Assets and Liabilities [Table Text Block]

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.



	Fair Value Measurements as of June 30, 2018
	Fair Value		Significant Valuation Techniques	Significant Unobservable Inputs⁽¹⁾	Range⁽¹⁾			Weighted - Average⁽¹⁾
	(Dollars in millions)
Recurring fair value measurements:
Trading securities:
Mortgage-related securities:
Agency⁽²⁾	$	79	Various
Mortgage revenue bonds	1		Various
Total trading securities	$	80
Available-for-sale securities:
Mortgage-related securities:
Agency⁽²⁾	$	204	Various
Alt-A and subprime private-label securities	26		Various
Mortgage revenue bonds	389		Single Vendor	Spreads (bps)	1.5	-	320.4	51.0
	117		Various
Total mortgage revenue bonds	506
Other	305		Discounted Cash Flow	Default Rate (%)	3.8			3.8
				Prepayment Speed (%)	6.5			6.5
				Severity (%)	95.0			95.0
				Spreads (bps)	68.5	-	400.0	399.0
	52		Various
Total other	357
Total available-for-sale securities	$	1,093
Net derivatives	$	107	Dealer Mark
	10		Various
Total net derivatives	$	117



	Fair Value Measurements as of December 31, 2017
	Fair Value		Significant Valuation Techniques	Significant Unobservable Inputs⁽¹⁾	Range⁽¹⁾				Weighted - Average⁽¹⁾
	(Dollars in millions)
Recurring fair value measurements:
Trading securities:
Mortgage-related securities:
Agency⁽²⁾	$	971	Single Vendor	Prepayment Speed (%)	0.0		-	177.0	160.0
				Spreads (bps)	51.5		-	375.0	200.1
	35		Various
Total agency	1,006
Alt-A and subprime private-label securities	154		Consensus
	40		Various
Total Alt-A and subprime private-label securities	194
Mortgage revenue bonds	1		Various
Total trading securities	$	1,201
Available-for-sale securities:
Mortgage-related securities:
Agency⁽²⁾	$	112	Single Vendor	Prepayment Speed (%)	0.0		-	175.7	147.1
				Spreads (bps)	150.0		-	210.0	182.3
	96		Various
Total agency	208
Alt-A and subprime private-label securities	77		Various
Mortgage revenue bonds	475		Single Vendor	Spreads (bps)	(17.0	)	-	248.0	39.0
	196		Various
Total mortgage revenue bonds	671
Other	325		Discounted Cash Flow	Prepayment Speed (%)	1.6		-	2.5	2.5
				Severity (%)	50.0		-	88.0	86.6
				Spreads (bps)	84.8		-	607.0	577.9
	32		Various
Total other	357
Total available-for-sale securities	$	1,313
Net derivatives	$	113	Dealer Mark
	21		Various
Total net derivatives	$	134

_________

⁽¹⁾

Valuation techniques for which no unobservable inputs are disclosed generally reflect the use of third-party pricing services or dealers, and the range of unobservable inputs applied by these sources is not readily available or cannot be reasonably estimated. Where we have disclosed unobservable inputs for consensus and single vendor techniques, those inputs are based on our validations performed at the security level using discounted cash flows. The prepayment speed used for trading agency securities and available-for-sale agency securities is the Public Securities Association prepayment speed, which can be greater than 100%. For all other securities, the Conditional Prepayment Rate is used as the prepayment speed, which can be between 0% and 100%.


⁽²⁾	Includes Fannie Mae and Freddie Mac securities.

Level 3 Assets Measured on Nonrecurring Basis [Table Text Block]

The following table displays valuation techniques for our Level 3 assets measured at fair value on a nonrecurring basis. The significant unobservable inputs related to these techniques primarily relate to collateral dependent valuations. The related ranges and weighted averages are not meaningful when aggregated as they vary significantly from property to property.



		Fair Value Measurements as of
	Valuation Techniques	June 30, 2018			December 31, 2017
		(Dollars in millions)
Nonrecurring fair value measurements:
Mortgage loans held for sale, at lower of cost or fair value	Single Vendor		$	618		$	1,880
	Consensus		4,427			1,113
	Various		1			—
Total mortgage loans held for sale, at lower of cost or fair value			5,046			2,993
Single-family mortgage loans held for investment, at amortized cost	Internal Model		790			1,623
Multifamily mortgage loans held for investment, at amortized cost	Asset Manager Estimate		131			163
	Various		24			32
Total multifamily mortgage loans held for investment, at amortized cost			155			195
Acquired property, net:⁽¹⁾
Single-family	Accepted Offers		181			218
	Appraisals		386			438
	Walk Forwards		154			222
	Internal Model		211			319
	Various		38			113
Total single-family			970			1,310
Multifamily	Various		16			19
Other assets	Various		1			2
Total nonrecurring assets at fair value			$	6,978		$	6,142

__________

⁽¹⁾

The most commonly used techniques in our valuation of acquired property are proprietary home price model and third-party valuations (both current and walk forward). Based on the number of properties measured as of June 30, 2018, these methodologies comprised approximately 76% of our valuations, while accepted offers comprised approximately 19% of our valuations. Based on the number of properties measured as of December 31, 2017, these methodologies comprised approximately 77% of our valuations, while accepted offers comprised approximately 18% of our valuations.

Fair Value of Financial Instruments [Table Text Block]

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, 2018
	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Netting Adjustment			Estimated Fair Value
	(Dollars in millions)
Financial assets:
Cash and cash equivalents and restricted cash	$	48,729	$	37,679	$	11,050	$	—	$	—		$	48,729
Federal funds sold and securities purchased under agreements to resell or similar arrangements	16,300		—		16,300		—		—			16,300
Trading securities	42,381		35,663		6,638		80		—			42,381
Available-for-sale securities	3,723		—		2,630		1,093		—			3,723
Mortgage loans held for sale	14,323		—		1,436		13,894		—			15,330
Mortgage loans held for investment, net of allowance for loan losses	3,194,301		—		2,917,541		231,082		—			3,148,623
Advances to lenders	3,901		—		3,899		2		—			3,901
Derivative assets at fair value	372		—		2,851		129		(2,608		)	372
Guaranty assets and buy-ups	151		—		—		370		—			370
Total financial assets	$	3,324,181	$	73,342	$	2,962,345	$	246,650	$	(2,608	)	$	3,279,729
Financial liabilities:
Short-term debt:
Of Fannie Mae	$	25,726	$	—	$	25,730	$	—	$	—		$	25,730
Of consolidated trusts	339		—		—		338		—			338
Long-term debt:
Of Fannie Mae	224,964		—		228,853		791		—			229,644
Of consolidated trusts	3,086,460		—		2,973,785		40,988		—			3,014,773
Derivative liabilities at fair value	604		—		3,348		12		(2,756		)	604
Guaranty obligations	163		—		—		121		—			121
Total financial liabilities	$	3,338,256	$	—	$	3,231,716	$	42,250	$	(2,756	)	$	3,271,210



	As of December 31, 2017
	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Netting Adjustment			Estimated Fair Value
	(Dollars in millions)
Financial assets:
Cash and cash equivalents and restricted cash	$	60,260	$	35,060	$	25,200	$	—	$	—		$	60,260
Federal funds sold and securities purchased under agreements to resell or similar arrangements	19,470		—		19,470		—		—			19,470
Trading securities	34,679		29,222		4,256		1,201		—			34,679
Available-for-sale securities	4,843		—		3,530		1,313		—			4,843
Mortgage loans held for sale	4,988		—		101		5,333		—			5,434
Mortgage loans held for investment, net of allowance for loan losses	3,173,537		—		2,886,470		315,719		—			3,202,189
Advances to lenders	4,938		—		4,936		2		—			4,938
Derivative assets at fair value	171		—		4,274		169		(4,272		)	171
Guaranty assets and buy-ups	149		—		—		436		—			436
Total financial assets	$	3,303,035	$	64,282	$	2,948,237	$	324,173	$	(4,272	)	$	3,332,420
Financial liabilities:
Short-term debt:
Of Fannie Mae	$	33,377	$	—	$	33,379	$	—	$	—		$	33,379
Of consolidated trusts	379		—		—		378		—			378
Long-term debt:
Of Fannie Mae	243,375		—		249,780		837		—			250,617
Of consolidated trusts	3,052,923		—		3,014,250		40,683		—			3,054,933
Derivative liabilities at fair value	328		—		5,272		35		(4,979		)	328
Guaranty obligations	258		—		—		456		—			456
Total financial liabilities	$	3,330,640	$	—	$	3,302,681	$	42,389	$	(4,979	)	$	3,340,091

Fair Value Option [Table Text Block]

The following table displays the fair value and unpaid principal balance of the financial instruments for which we have made fair value elections.



	As of
	June 30, 2018									December 31, 2017
	Loans⁽¹⁾			Long-Term Debt of Fannie Mae			Long-Term Debt of Consolidated Trusts			Loans⁽¹⁾			Long-Term Debt of Fannie Mae			Long-Term Debt of Consolidated Trusts
	(Dollars in millions)
Fair value		$	9,628		$	7,558		$	26,675		$	10,596		$	8,186		$	30,493
Unpaid principal balance		9,510			6,780			24,695			10,246			7,368			27,717

__________

⁽¹⁾

Includes nonaccrual loans with a fair value of $181 million and $227 million as of June 30, 2018 and December 31, 2017, respectively. The difference between unpaid principal balance and the fair value of these nonaccrual loans as of June 30, 2018 and December 31, 2017 was $28 million and $46 million, respectively. Includes loans that are 90 days or more past due with a fair value of $131 million and $159 million as of June 30, 2018 and December 31, 2017, respectively. The difference between unpaid principal balance and the fair value of these 90 or more days past due loans as of June 30, 2018 and December 31, 2017 was $22 million and $34 million, respectively.

- Definition

Tabular disclosure of the application of the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected, provide the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (b) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (c) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) for loans and other receivables held as assets, the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk; (c) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk, the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk; and (3) certain other disclosures as required or determined to be provided.

+ References + Details