A certificate indicating the owner and the percentage of ownership of a pool of loans.

(CD) CONCURRENT DATE

In this type of Mortgage-Backed Securities (MBS) pool, all the pooled loans have monthly installments paid up through the same date as the issue date of the pool. If mortgagor payments for dates prior to the issue date are delinquent, they are due to the prior holder of the loan, not the pool. For example, in a pool with an April 1 issue date, all the loans are pooled with interest and principal installments paid through April 1. The May 1 installments are the initial payments due the pool. Form HUD 11710A, submitted for the April reporting month, reports installment collections that are due on or after May 1. All pools under GNMA II (except manufactured home pools or, possibly, pools converted from GNMA I) are concurrent date pools.

CUSTODIAL ACCOUNT

A bank account a lender must establish to hold the funds of others - the borrower and investor.

GNMA I

The servicer sets up the pool and all Certificate Holders. The servicer disburses the funds collected in Loan Servicing to each Certificate Holder.

GNMA II

The loan payments collected by the servicer are remitted directly to GNMA. GNMA retains all information for each Certificate Holder, and disburses funds to them.

GUARANTY FEE

Fannie Mae's charge to lenders for guaranteeing to an investor the timely payment of principal and interest from all the mortgages underlying a Fannie Mae MBS.

IR (INTERNAL RESERVE)

In this type of MBS pool, all the pooled loans have their monthly installments paid up through the first day of the month prior to the month of issue. For example, in a pool with an April 1 issue date, the loans are pooled with interest and principal installments paid through March 1. The April 1 installments are the initial payments due the pool. Form HUD 11710A submitted for the April reporting month reports installment collections that are due on or after April 1. All manufactured home pools are Internal Reserve Pools.

ISSUE DATE

The first day of the month in which securities backed by an MBS pool are issued; for instance, if the pool settlement date is November 14, the issue date is considered to be November 1.

LOOK BACK PERIOD

The date on which the index value that will be used to establish the next interest rate charge for an ARM is determined. It is a specified number of days (usually 30 to 45) before the interest rate change date.

MARGIN

The amount that is added to an index value to create the mortgage interest rate for an Adjustable Rate Mortgage (ARM) or a Graduated Payment Adjustable Rate Mortgage (GPM/ARM).

MBS EXPRESS®

An MBS pool for which the lender remits "unscheduled" principal payments to us on the fourth business day of the month and "scheduled" principal and interest payments on the 18^th calendar day.

MBS POOL MORTGAGE

A mortgage (or participation interest in a mortgage) that is part of an MBS pool.

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MORTGAGE-BACKED SECURITY (FANNIE MAE MBS)

Security issued against a pool of mortgages with similar characteristics. The security is an investment instrument that represents an undivided interest in a pool of mortgages. Cash flows generated by the underlying mortgages are passed through each month from the servicers of the mortgages to the investors.

Information on each Certificate Holder is retained by Fannie Mae. Fannie Mae disburses funds to each Certificate Holder. The servicer passes the funds directly to Fannie Mae.

MULTIPLE POOL

An MBS pool that consists of groups of whole mortgages delivered by more than one lender; also called Fannie Majors.

NET NOTE RATE

The mortgage interest rate after the applicable servicing fee and any guaranty fee for our various product types have been subtracted.

PARTICIPATION POOL

The group of mortgages that backs a participation certificate. We purchase only a percentage interest in each of the mortgages for our portfolio. That interest is the same percentage that is specified on the participation certificate.

PARTICIPATION POOL MORTGAGE

A mortgage that is part of a participation pool.

PASS-THROUGH RATE

For MBS, this is the interest rate of the security issued pursuant to a Pool Purchase Transaction.

POOL

All of the mortgages (or participation interests) delivered pursuant to one or more pool purchase contracts that secure an individual issue of mortgage-backed securities.

POOL ACCRUAL RATE

The rate of interest that accrues to the security holder of a stated structure ARM MBS pool - the pass-through rate.

POOL EXCESS FUNDS REPORT

The amount of prepayment, liquidations, and curtailments that are in the P&I custodial account at the time the checks are written. These excess funds cannot be used toward the remittance to the certificate holders.

POOL PURCHASE CONTRACT

A contract between Fannie Mae and a lender to buy and sell mortgages for inclusion in a pool.

SCHEDULED/SCHEDULED REMITTANCE TYPE

A method of sending monthly mortgage payments that requires the lender to remit the scheduled interest due and the scheduled principal due (whether or not payments are collected from mortgagors).

SECURITY

An ownership interest in a pool of mortgages, which is evidenced by either a definitive certificate that is authenticated by the certificate registrar or a book-entry account within the Federal Reserve's book-entry system.

SECURITY BALANCE

For an MBS pool mortgage (or a participation interest in an MBS pool mortgage), this is determined by reducing Fannie Mae's share of the issue date principal balance of the mortgage by our share of any principal distribution amounts included in subsequent monthly remittances. For the MBS pool itself, the aggregate security balance of all the mortgages (or participation interests) in the pool as of any date is equal to the aggregate issue date principal balances of the mortgages (or participation interests) less any subsequent principal distribution amounts.

SECURITY HOLDER

A certificate holder making up the ownership of the security pool.

SERIAL POOL

A pool set up where the funds are paid to the certificate holder in serial number order. The certificate holder receives interest only until the redemption date of the serial certificate.

WEIGHTED-AVERAGE ACCRUAL RATE

The weighted-average (rounded to three decimal places) of the accrual rates for the mortgages in an ARM Flex MBS pool (or any other weighted-average coupon MBS pool). It is the rate at which interest will accrue on the securities.

WHOLE LOAN

The purchaser of a loan buys 100% of the loan. The note is endorsed over to the new owner and an assignment of rights is executed and recorded.