WASHINGTON, Sept. 29 /PRNewswire-FirstCall/ Fannie Mae (NYSE: FNM) will redeem the principal amounts indicated for the following securities issues on the redemption dates indicated below at a redemption price equal to 100 percent of the principal amount redeemed, plus accrued interest thereon to the date of redemption:

      Principal  Security Interest
        Amount     Type     Rate    Maturity Date     CUSIP    Redemption Date
    $250,000,000   MTN     4.650%   October 9, 2009  31398AHM7 October 9, 2008
    $200,000,000   MTN     5.325%   October 9, 2012  31398AHD7 October 9, 2008

This press release does not constitute an offer to sell or the solicitation of an offer to buy securities of Fannie Mae. Nothing in this press release constitutes advice on the merits of buying or selling a particular investment. Any investment decision as to any purchase of securities referred to herein must be made solely on the basis of information contained in Fannie Mae's applicable Offering Circular, and that no reliance may be placed on the completeness or accuracy of the information contained in this press release.

You should not deal in securities unless you understand their nature and the extent of your exposure to risk. You should be satisfied that they are suitable for you in the light of your circumstances and financial position. If you are in any doubt you should consult an appropriately qualified financial advisor.

SOURCE Fannie Mae