Appraisers' Free Forum

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In the same nine-month period a year earlier, the company earned $3.5 billion, or $3.16 a share. The latest results were affected by declining home prices and regional economic conditions, the company explained.

The company also offered an outlook, saying it expects the 'market forces' that affected results in the first nine months of 2007 to continue through the end of the year but that it anticipates its net interest yield will remain 'relatively stable' for the rest of the year.

It expects the downturn in the housing market to continue for the rest of 2007 and into 2008. It sees a decline of about 2% in home prices on a national basis in 2007 and a decline of about 4% in 2008.

Fannie Mae anticipates the housing market weakness will lead to further declines in mortgage originations in both 2007 and 2008.