Fannie Mae Announces Mortgage Relief for Victims ofHurricane Georges in Alabama.

MOBILE, Ala.--(BUSINESS WIRE)--Oct. 1, 1998--

Fannie Mae/FEMA Making New Program Available to

Help Homeowners Make Future Disaster Prevention Improvements

Fannie Mae (FNM/NYSE), the nation's largest source of home mortgage funds, has mortgage relief provisions in place

To help homeowners make certain disaster prevention home upgrades, Fannie Mae and the Federal Emergency Management Agency (FEMA) are working with local lenders and contractors to introduce the Project Impact Prevention Loan within the next four weeks.

The program offers consumer installment loans to homeowners at competitive interest rates.

Fannie Mae's disaster relief provisions give mortgage servicers the discretion to help borrowers in several ways, including suspending mortgage payments for up to three months, reducing the payments for up to 18 months, or in more special cases, creating longer loan payback plans. All changes will be made on a case-by-case basis.

Fannie Mae's business guidelines also advise lenders to counsel borrowers on all possible mortgage payment work-out options, and to inform homeowners of disaster relief available from federal agencies.

Payment relief is available for single-family mortgages (including condos) serviced by Fannie Mae lenders in areas affected by the hurricane. Holders of Fannie Mae mortgage securities will be paid as usual during the relief period.

Mortgage lenders doing business with Fannie Mae will, according to Fannie Mae's guidelines, determine appropriate relief steps by considering:

-- any uninsured losses;

-- extended unemployment; and,

-- extraordinary expenses related to the hurricane that affect

mortgage payments.

For information on available mortgage relief, homeowners who have experienced hardship that makes it difficult to make their mortgage payment should contact the lender to whom they send their monthly mortgage payment.

FEMA's Project Impact Prevention Loan is part of its overall initiative designed to encourage actions that protect families, businesses, and communities by reducing the impact of natural disasters through local public and private sector partnerships.

The new installment loan offers a quick approval process, a competitive interest rate, and an assurance that work will be performed by approved and certified contractors.

Examples of the type of upgrades that can be financed under the program include: structural elevation, utility protection/elevation, foundation bolting, structural strengthening for wind, and construction of an in-home "safe room."

The initiative is also being expanded to offer financing to homeowners in Florida, Louisiana, and Mississippi.

For additional information on the Project Impact Prevention Loan, consumers may call Fannie Mae's Consumer Resource Center at 800/7FANNIE (800/732-6643) between 8 a.m. and 4 p.m. CDT.

Fannie Mae is a congressionally chartered, shareholder-owned company and the nation's largest source of funds for home mortgages. It has committed to provide $1 trillion in targeted lending for 10 million homes by the end of the decade.

The targeted lending will serve low- and moderate-income families, minorities, new immigrants, residents of central cities and other underserved areas, and people who have special housing needs.

Over the past 30 years, Fannie Mae has provided $2.5 trillion in mortgage financing for 31 million families. More information about Fannie Mae can be found on the Internet at http://www.fanniemae.com.

Style Usage: Fannie Mae's Board of Directors has authorized the company to operate as "Fannie Mae," and the company's stock is now listed on the NYSE as "Fannie Mae." In order to facilitate clarity and avoid confusion, news organizations are asked to refer to the company exclusively as "Fannie Mae."