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FannyMae 05.Jan.1994 D-Class666

FannyMae 05.Jan.1994 D-Class666

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Prospectus Supplement(To Prospectus dated December 29, 1992)
$
600,000,000Federal National Mortgage Association
 rs t u v
Guaranteed REMIC Pass-Through CertiÑcatesFannie Mae REMIC Trust 1994-18
The Guaranteed REMIC Pass-Through CertiÑcates oÅered hereby (the ""CertiÑcates'') will represent beneÑcial ownership interests in one of two trust funds. The CertiÑcates, other than the RL Class, will represent beneÑcial ownership interests in Fannie Mae REMIC Trust1994-18 (the ""Trust''). The assets of the Trust will consist of the ""regular interests'' in a separate trust fund (the ""Lower Tier REMIC'').The assets of the Lower Tier REMIC will consist of (a) a single Fannie Mae Stripped Mortgage-Backed Security (the ""SMBS'') whichevidences the beneÑcial ownership interest in certain distributions of principal and interest made in respect of certain Fannie MaeGuaranteed Mortgage Pass-Through CertiÑcates, held in the form of a Fannie Mae Guaranteed MBS Pass-Through CertiÑcate (the ""MegaCertiÑcate'') and included in Fannie Mae Stripped Mortgage-Backed Security Trust 000257-CL (the ""SMBS Trust'') and (b) certainFannie Mae Guaranteed Mortgage Pass-Through CertiÑcates (the ""Trust MBS'' and together with the Fannie Mae Guaranteed MortgagePass-Through CertiÑcates underlying the SMBS, the ""MBS''). Each MBS will represent a beneÑcial interest in a pool (each, a ""Pool'') of Ñrst lien, single-family, Ñxed-rate residential mortgage loans (the ""Mortgage Loans'') having the characteristics described herein. TheCertiÑcates will be issued and guaranteed as to timely distribution of principal and interest by Fannie Mae and oÅered by Fannie Maepursuant to its Prospectus for Guaranteed Mortgage Pass-Through CertiÑcates (the ""MBS Prospectus''), its Prospectus for StrippedMortgage-Backed Securities (the ""SMBS Prospectus'') and its Prospectus for Guaranteed MBS Pass-Through CertiÑcates (the ""MegaProspectus''), each available as described herein, and its Prospectus for Guaranteed REMIC Pass-Through CertiÑcates (the ""REMICProspectus''), accompanying this Prospectus Supplement.
Elections will be made to treat the Lower Tier REMIC and the Trust as ""real estate mortgage investment conduits'' (""REMICs'') pursuant to the InternalRevenue Code of 1986, as amended (the ""Code''). The R and RL Classes will be subject to transfer restrictions. See ""Description of the CertiÑcateCharacteristics of the R and RL Classes'' and ""Certain Additional Federal Income Tax Consequences'' herein, and ""Description of the CertiÑcatesÌAdditional Characteristics of Residual CertiÑcates'' and ""Certain Federal Income Tax Consequences'' in the REMIC Prospectus.
(Cover continued on next page)
THE CERTIFICATES, TOGETHER WITH ANY INTEREST THEREON, ARE NOT GUARANTEED BY THE UNITED STATES. THEOBLIGATIONS OF FANNIE MAE UNDER ITS GUARANTY OF THE CERTIFICATES ARE OBLIGATIONS SOLELY OF FANNIE MAEAND DO NOT CONSTITUTE AN OBLIGATION OF THE UNITED STATES OR ANY AGENCY OR INSTRUMENTALITY THEREOFOTHER THAN FANNIE MAE. THE CERTIFICATES ARE EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURI-TIES ACT OF 1933 AND ARE ""EXEMPTED SECURITIES'' WITHIN THE MEANING OF THE SECURITIES EXCHANGE ACT OF 1934.
Original PrincipalPrincipalInterestInterestFinal DistributionClassBalanceType(1)RateType(1)Date
A$274,482,758TAC6.10%FIXAugust 2021B47,111,112TAC6.75FIXOctober 2022C47,111,112TAC6.75FIXDecember 2023D10,666,666TAC6.75FIXFebruary 2024F22,105,264SUP(2)FLTFebruary 2024S19,894,736SUP(2)INVFebruary 2024FA178,628,352CPT(2)FLTFebruary 2024SA(3)NTL(2)INV/IOFebruary 2024SB(3)NTL(2)INV/IOFebruary 2024R0NPR0NPRFebruary 2024RL0NPR0NPRFebruary 2024
(1)See ""Description of the CertiÑcatesÌClass DeÑnitions and Abbreviations'' in the REMIC Prospectus and ""Description of the CertiÑcatesÌDistributions of Interest'' and ""ÌDistributions of Principal'' herein.(2)These Classes will bear interest based on ""LIBOR'' as described under ""Description of the CertiÑcatesÌDistributions of Interest'' herein and""Description of the CertiÑcatesÌIndices Applicable to Floating Rate and Inverse Floating Rate Classes'' in the REMIC Prospectus.(3)The SA and SB Classes will be Notional Classes, will have no principal balances and will bear interest on their notional principal balances(initially, $178,628,352 and $178,628,352, respectively). The notional principal balances of the SA and SB Classes will be calculated based onthe principal balance of the FA Class, which consists of a TAC Component and a Support Component. See ""Description of the CertiÑcatesÌGeneralÌ
 Notional Classes
'' herein.
The CertiÑcates will be oÅered by J.P. Morgan Securities Inc. (the ""Dealer'') and First Union Securities, Inc. (""First Union'') from time totime in negotiated transactions, at varying prices to be determined at the time of sale.The CertiÑcates will be oÅered by the Dealer, subject to issuance by Fannie Mae and to prior sale or to withdrawal or modiÑcation of the oÅerwithout notice, when, as and if delivered to and accepted by the Dealer, and subject to approval of certain legal matters by counsel. It isexpected that the CertiÑcates, except for the R and RL Classes, will be available through the book-entry system of the Federal ReserveBanks on or about February 28, 1994 (the ""Settlement Date''). It is expected that the R and RL Classes in registered, certiÑcated form willbe available for delivery at the oÇces of the Dealer in New York, New York, on or about the Settlement Date.
J.P. Morgan Securities Inc.First Union Securities, Inc.
January 5, 1994
 
(Cover continued from previous page)
THE CERTIFICATES MAY NOT BE SUITABLE INVESTMENTS FOR ALL INVESTORS. NOINVESTOR SHOULD PURCHASE CERTIFICATES UNLESS SUCH INVESTOR UNDERSTANDS ANDIS ABLE TO BEAR THE PREPAYMENT, YIELD, LIQUIDITY AND OTHER RISKS ASSOCIATEDWITH SUCH CERTIFICATES.The yield to investors in each Class will be sensitive in varying degrees to the rate of principalpayments of the Mortgage Loans, the characteristics of the Mortgage Loans actually included in the Pool,the purchase price paid for the related Class and, in the case of any Floating Rate and Inverse FloatingRate Classes, the level of the applicable Index (as deÑned herein). Accordingly, investors should considerthe following risks:The Mortgage Loans generally may be prepaid at any time without penalty, and, accordingly,the rate of principal payments thereon is likely to vary considerably from time to time.Slight variations in Mortgage Loan characteristics could substantially aÅect the weightedaverage lives and yields of some or all of the Classes.In the case of any CertiÑcates purchased at a discount to their principal amounts, a slower thananticipated rate of principal payments is likely to result in a lower than anticipated yield.In the case of any CertiÑcates purchased at a premium to their principal amounts, a faster thananticipated rate of principal payments is likely to result in a lower than anticipated yield.In the case of any Interest Only Class, a faster than anticipated rate of principal payments islikely to result in a lower than anticipated yield and, in certain cases, an actual loss on theinvestment.The yield on any Floating Rate or Inverse Floating Rate Class will be sensitive to the level of the applicable Index, particularly if the interest rate thereon Öuctuates as a multiple of suchIndex.See ""Description of the CertiÑcatesÌYield Considerations'' herein.In addition, investors should purchase CertiÑcates only after considering the following:The actual Ñnal payment of any Class will likely occur earlier, and could occur much earlier,than the Final Distribution Date for such Class speciÑed on the cover page. See ""Description of the CertiÑcatesÌWeighted Average Lives of the CertiÑcates'' herein and ""Description of theCertiÑcatesÌWeighted Average Life and Final Distribution Dates'' in the REMIC Prospectus.The rate of principal distributions of the CertiÑcates is uncertain and investors may be unableto reinvest the distributions thereon at yields equaling the yields on the CertiÑcates. See""Description of the CertiÑcatesÌReinvestment Risk'' in the REMIC Prospectus.Investors whose investment activities are subject to legal investment laws and regulations or toreview by regulatory authorities may be subject to restrictions on investment in certain Classesof the CertiÑcates. Investors should consult their legal advisors to determine whether and towhat extent the CertiÑcates constitute legal investments or are subject to restrictions oninvestment. See ""Legal Investment Considerations'' in the REMIC Prospectus.
The Dealer intends to make a market for the CertiÑcates but is not obligated to do so. There can be no assurancethat such a secondary market will develop or, if developed, that it will continue. Thus, investors may not be able to selltheir CertiÑcates readily or at prices that will enable them to realize their anticipated yield. No investor shouldpurchase CertiÑcates unless such investor understands and is able to bear the risk that the value of the CertiÑcates willÖuctuate over time and that the CertiÑcates may not be readily salable.These securities have not been approved or disapproved by the Securities and Exchange Commission or any statesecurities commission nor has the Securities and Exchange Commission or any state securities commission passedupon the accuracy or adequacy of this Prospectus Supplement, the REMIC Prospectus, the SMBS Prospectus, theMega Prospectus or the MBS Prospectus. Any representation to the contrary is a criminal oÅense.This Prospectus Supplement does not contain complete information about the CertiÑcates. Investors shouldpurchase CertiÑcates only after reading this Prospectus Supplement, the REMIC Prospectus, the MBS Prospectusdated January 1, 1994, the SMBS Prospectus dated December 31, 1993, the Mega Prospectus dated December 31, 1993and the Fannie Mae Information Statement dated February 16, 1993 and any supplements thereto (the ""InformationStatement''). The MBS Prospectus, the SMBS Prospectus, the Mega Prospectus and the Information Statement areincorporated herein by reference and may be obtained from Fannie Mae by writing or calling its MBS Helpline at3900 Wisconsin Avenue, N.W., Area 2H-3S, Washington, D.C. 20016 (telephone 1-800-BEST-MBS or 202-752-6547).Such documents may also be obtained from J.P. Morgan Securities Inc. by writing or calling its ProspectusDepartment at 60 Wall Street, New York, New York 10260 (telephone (212) 648-9922).
S-2
 
TABLE OF CONTENTS
PagePage
Description of the CertiÑcates
ÏÏÏÏÏÏS-4
Principal Distribution Amount 
ÏÏÏÏÏS-9GeneralÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-4Structuring AssumptionsÏÏÏÏÏÏÏÏÏÏÏÏS-10
StructureÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
S-4
Pricing Assumptions
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-10
The Trust MBS and SMBSPSA Assumptions
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-10
Distributions
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-4Principal Balance SchedulesÏÏÏÏÏÏÏÏÏS-11
 Fannie Mae Guaranty
ÏÏÏÏÏÏÏÏÏÏÏÏÏS-4Characteristics of the R and
Characteristics of CertiÑcates
ÏÏÏÏÏÏS-4RL ClassesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-14
Notional Classes
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-5Yield ConsiderationsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-14
Components
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-5
General
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-14
 Authorized Denominations
ÏÏÏÏÏÏÏÏS-5
The Inverse Floating Rate Classes
ÏÏÏS-15
Distribution Dates
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-6Weighted Average Lives of the
Calculation of Distributions
ÏÏÏÏÏÏÏÏS-6CertiÑcatesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-16
Record Date
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-6Decrement TablesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-17
REMIC Trust Factors
ÏÏÏÏÏÏÏÏÏÏÏÏÏS-6
Certain Additional Federal Income
Optional Termination
ÏÏÏÏÏÏÏÏÏÏÏÏÏS-6
Tax Consequences
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-19The Trust MBS and SMBSÏÏÏÏÏÏÏÏÏS-7REMIC Elections and Special TaxDistributions of InterestÏÏÏÏÏÏÏÏÏÏÏÏÏS-7AttributesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-19
Categories of Classes
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-7Taxation of BeneÑcial Owners of 
General
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-7Regular CertiÑcatesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-19
Interest Accrual Periods
ÏÏÏÏÏÏÏÏÏÏÏS-8Taxation of BeneÑcial Owners of 
 Floating Rate and Inverse Floating 
Residual CertiÑcatesÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-20
Rate Classes
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-8
Plan of Distribution
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-20Calculation of LIBORÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-8
General
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-20Distributions of PrincipalÏÏÏÏÏÏÏÏÏÏÏS-9
Increase in CertiÑcates
ÏÏÏÏÏÏÏÏÏÏÏÏS-20
Categories of Classes andComponents
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-9
Legal Matters
ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏS-20S-3

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