Is FNMA (Federal National Mortgage Association) Halal or Haram?

Based on our AAOIFI-standard shariah screening, FNMA is Not Halal (Haram) and is not considered permissible for Muslim investors. It failed 4 of 4 compliance screens. Federal National Mortgage Association's core business activity was found to be non-compliant. Its debt-to-market-cap ratio of 49789.92% exceeds the ≤33% threshold. Its interest income of 98.79% exceeds the ≤5% limit. Its cash & securities ratio of 136.40% exceeds the ≤33% threshold.

Federal National Mortgage Association, commonly known as Fannie Mae, is a government-sponsored enterprise (GSE) that plays a central role in the U.S. housing market. It does not originate loans directly but instead purchases mortgages from lenders to hold in its portfolio or package into mortgage-backed securities (MBS). By guaranteeing these securities, Fannie Mae provides liquidity to the mortgage market, allowing banks to lend more money for home purchases. For Muslim investors, Fannie Mae presents a clear case of non-compliance, classified as Haram under AAOIFI standards. The company failed all four screening criteria, most notably the business activity screen, as its entire existence is predicated on the trade of interest-bearing debt instruments. Because the core business involves Riba (interest/usury), it is structurally incompatible with Islamic investment principles regardless of its financial ratios. Financially, the company's metrics reinforce this non-compliant status with extreme violations of financial thresholds. Interest income accounts for nearly 99% of its total revenue, while its debt-to-market cap ratio is an astronomical 49,789.9%, reflecting its massive leverage relative to its equity value. Additionally, its cash and interest-bearing securities significantly outweigh its market capitalization, failing the liquidity screen and confirming its status as a prohibited investment. Federal National Mortgage Association operates in the Financial Services sector under the Financial - Mortgages industry and is headquartered in Washington, DC, US. The company is led by CEO Peter Andrew Akwaboah and employs approximately 8,200 people.

FNMA was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. FNMA passed 0 of these 4 screens.

FNMA was last screened on 2026-02-25. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.