Fannie Mae reported second-quarter 2025 results on July 30, showing steady revenue, tighter expenses, and resilient credit performance in its single-family business — even as a sluggish spring buying season and elevated mortgage rates dampened overall loan acquisition volumes.
The government-sponsored enterprise (GSE) provided $102 billion in liquidity to the housing market in the quarter, helping finance 381,000 households. That total included 183,000 homebuyers, with first-time buyers accounting for 52% of purchase mortgages acquired.
“Despite a sluggish spring home buying season, we proudly continued to make a material positive impact for American households,” said Fannie Mae President and CEO Priscilla Almodovar. She added that the company is working to “continue to find ways to make housing more affordable, drive efficiencies, and prevent fraud.”
Loan Acquisition And Borrower Profile
Single-family acquisition volume totaled $84.1 billion in Q2, down slightly from $85.9 billion a year earlier. Purchase volume came in at $64.3 billion — with about half for first-time homebuyers — down from $74.5 billion in Q2 2024. Refinances, however, rose to $19.8 billion from $11.4 billion a year earlier, aided by a modest uptick in activity from Q1’s seasonal low.
The average single-family guaranty book stood at $3.6 trillion, with credit quality holding strong with a weighted-average FICO score of 753 and mark-to-market loan-to-value (LTV) ratio of 50%. Notably, 74% of mortgages in the book carried rates below 5%, underscoring the “rate lock” effect that continues to dampen refinance incentives.
Delinquencies And Credit Quality
The single-family serious delinquency rate improved to 0.53% for the quarter that ended June 30, down slightly from 0.56% in Q1. However, 30-day delinquencies rose by 10 basis points — a seasonal pattern often seen after the first quarter — and Fannie Mae attributed some lingering regional delinquency pressure to hurricanes in late 2024.
CFO Chryssa C. Halley noted “some regional home price softness, including price declines in a small number of MSAs,” but said net charge-offs remain “muted,” with single-family charge-offs steady at 1 basis point.
Credit Loss Provisions
The GSE booked a $737 million single-family provision for credit losses in the quarter, primarily from “lower actual and forecasted home price growth.” The total allowance for loan losses rose to 20 basis points of the book, up from 18 basis points in Q1.
Guaranty Fees Edge Higher
The average charged guaranty fee on new single-family acquisitions rose to 57.3 basis points, up from 51.9 bps in Q2 2024. Fannie Mae cited a shift toward “loans with higher upfront fees” and higher base g-fees on new loans. The average g-fee across the single-family book increased to 48.3 bps.
Expense Discipline And Efficiency Gains
Administrative expenses in the single-family business dropped 15% from Q1 and 8% year-over-year to $687 million, part of a broader $256 million decline in non-interest expenses for the company overall. Halley said reductions in headcount, contractor use, and credit enhancement costs were key drivers there.
The efficiency ratio — a measure of expenses relative to revenue — improved to 31.5% from 36.1% last quarter.
“We will continue operating the company as a for-profit enterprise so that we can drive down housing costs and deliver maximum value for the American people,” stated Federal Housing Finance Agency (FHFA) Director and Fannie Mae Chairman William J. Pulte in a release.
Capital Build And Risk Transfer
Fannie Mae’s net worth surpassed $100 billion for the first time, ending Q2 at $101.6 billion — an $88 billion increase since January 2020. Common equity tier-one (CET-1) capital has grown by $45 billion since Q4 2022, though the GSE still faces a $29 billion regulatory capital deficit.
As of Q2, 38% of the single-family book was covered by credit risk transfer (CRT) transactions.
Revenue And Income
Fannie Mae reported $7.2 billion in net revenues for the second quarter, up 2% from $7.1 billion in Q1 2025 and down 1% from $7.3 billion in Q2 2024.
Net income came in at $3.3 billion, a 9% decline from $3.66 billion in the prior quarter and down 26% from $4.48 billion in the year-ago quarter, with the company attributing the year-over-year decrease primarily due to the higher provision for credit losses.
Fraud Prevention Partnership
A notable operational development this quarter was a fraud detection and prevention partnership with Palantir Technologies, which Almodovar described as part of the company’s broader effort to protect credit quality and reduce costs tied to fraudulent activity.
While Fannie Mae’s Q2 results underscore that the housing market remains constrained by high rates and modest home price growth, they signal stability in the company’s core single-family business — with delinquencies edging down, guaranty fees rising on new loans, expenses under tighter control, and capital continuing to build, though that is still at a $29 billion regulatory deficit.
The takeaway is a GSE still actively buying loans, maintaining strong credit standards, and investing in fraud prevention. For originators, the results reinforce that Fannie Mae remains an active and stable purchaser of loans in a rate-challenged market, while steadily tightening operational efficiency and credit oversight.
