Freddie Mac Update

October 2016

© Freddie Mac 2

“A primary purpose is to provide stability in the secondary market for home mortgages including mortgages securing housing for low and moderate income families. This can be accomplished through both portfolio purchasing and selling activities, as well as through the securitization of home mortgages.”1

U.S. Residential

Mortgage Market

Mortgage

Investments

Mortgage

Securitization

1 House of Representatives report on FIRREA, No. 54, 101st Congress, 1st Session, Part 3 at 2 (1989).

Freddie Mac

Global Capital

Markets

Mortgage-backed

Securities

Debt

Securities

Freddie Mac’s mission

© Freddie Mac 3

We continue to operate under the conservatorship that commenced on September 6, 2008, under the direction of the Federal Housing Finance Agency (FHFA) as our Conservator.

FHFA as our Conservator:

» FHFA assumed all powers of the Board, management and shareholders

» FHFA has directed and will continue to direct certain of our business activities and strategies

» FHFA delegated certain authority to our Board of Directors to oversee, and to management to conduct, day-to-day operations

Our ability to access funds from the Treasury under the Purchase Agreement is critical to keeping us solvent.

There is significant uncertainty as to whether or when we will emerge from conservatorship, as it has no specified termination date.

Our future structure and role will be determined by the Administration and Congress, and there will likely be significant changes beyond the near term.

Conservatorship

© Freddie Mac 4

Freddie Mac’s Credit Rating

1. Fitch assigns Recovery Ratings to certain lower-rated securities and issues. The Recovery Scale ("RR1," highest, to "RR6,"

lowest) is based upon the expected relative recovery characteristics of an obligation.

Ratings are not a recommendation to purchase, hold or sell securities and may be changed, suspended or withdrawn at any

time by the assigning rating agency. Freddie Mac's current ratings and the rating outlooks currently assigned to Freddie Mac

are dependent upon economic conditions and other factors affecting credit risk that are outside the control of Freddie Mac.

Each rating should be evaluated independently of the others. Detailed explanations of the ratings may be obtained from the

rating agencies. The information above was obtained from information available on the websites of the rating agencies.

Freddie Mac makes no representations or warranties with respect to the information contained herein and takes no

responsibility for supplementing, updating or correcting any such information.

© Freddie Mac 5

2016 Conservatorship Scorecard

5

Strategic Goal Weight Scorecard Objective

Maintain 40%

Increase access to mortgage credit for creditworthy borrowers

Develop post-crisis loss mitigation activities and prepare for expiration of HAMP and HARP

Continue to responsibly reduce the number of severely-aged delinquent loans and REO

properties

Maintain new multifamily business volume at $35 billion or below (excluding certain mission-

related activity)

Reduce 30%

Single-family:

• Complete credit risk transfers on at least 90% UPB of newly acquired mortgages in loan

categories targeted for risk transfer

• Work with FHFA to assess front-end credit risk transfer transactions

Multifamily: Continue current multifamily credit risk transfer initiatives and explore additional

risk transfer opportunities

Retained Portfolio: Continue to implement approved plan to meet the annual PSPA

requirements and the $250 billion PSPA cap by December 31, 2018

Support FHFA in its development for a risk measurement framework

Build 30%

Continue implementation of required changes to systems and operations for integration into

Common Securitization Platform

• Implement the CSP for Freddie Mac’s existing single-class securities in 2016

Finalize the Single Security structure and develop a plan to implement the single security on

the CSP in 2018

Provide active support for Mortgage Data Standardization Initiatives:

• Uniform Closing Disclosure Dataset (UCD)

• Uniform Loan Application Dataset (ULAD)

• Assess and implement strategies to improve origination and delivery of e-mortgages to

the Enterprises

© Freddie Mac 6

On August 17, 2012, Freddie Mac, acting through FHFA, as Conservator, and Treasury

entered into a third amendment to the Purchase Agreement.

The principal changes, which are consistent with FHFA’s strategic plan for Freddie Mac and

Fannie Mae conservatorships, include:

» Replacement of the fixed dividend rate with a net worth sweep dividend beginning for the

first quarter of 2013

» Accelerated wind-down of the retained portfolio

» Submission of annual risk management plan to Treasury

» Suspension of periodic commitment fee

Amended Purchase Agreement

© Freddie Mac 7

Market presence

1 2016 data as of June 30, 2016.

Source: Inside Mortgage Finance.

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

YTD

2016

Enterprises &

Ginnie Mae 44% 62% 95% 97% 96% 98% 99% 98% 96% 96% 98%

Private Label 56% 38% 5% 3% 4% 2% 1% 2% 4% 4% 2%

MBS Issuance Volume $ in Trillions

1

$2.0

$1.9

$1.2

$1.8

$1.5

$1.2

$1.7 $1.6

$0.9

$1.3

$0.6

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 YTD2016

Freddie Mac Fannie Mae Ginnie Mae Private Label

© Freddie Mac 8

$23.8

$47.6

$19.6

$5.5 $2.7

$99.1

2008 -2012

2013 2014 2015 YTD2016

CumulativeTotal1,3

Dividend Payments to Treasury4 Draw Requests from Treasury

Treasury draw requests and dividend payments

1 Data for the three months ended June 30, 2016.

2 Excludes the initial $1 billion liquidation preference of senior preferred stock issued to Treasury in September 2008 as consideration for Treasury’s funding commitment. The

company received no cash proceeds as a result of issuing this initial $1 billion liquidation preference of senior preferred stock.

3 Includes the September 2016 dividend obligation of $933 million.

4 Represents quarterly cash dividends paid by Freddie Mac to Treasury during the periods presented. Through December 31, 2012, Treasury was entitled to receive cumulative

quarterly cash dividends at the annual rate of 10% per year on the liquidation preference of the senior preferred stock. However, the fixed dividend rate was replaced with a net

worth sweep dividend payment beginning in the first quarter of 2013. See the company’s Annual Report on Form 10-K for the year ended December 31, 2015 for more information.

Note: Totals may not add due to rounding.

Draw Requests From Treasury $ Billions

Dividend Payments to Treasury $ Billions

$71.3

$0.0 $0.0 $0.0 $0.0

$71.3

2008 -2012

2013 2014 2015 YTD2016

CumulativeTotal

1 2 3

© Freddie Mac 9

$347 $340 $321

$399 $399 $399 $399

$339

12/31/15 3/31/16 6/30/16 9/30/16 12/31/16

Mortgage-Related Investments Portfolio Ending Balance

Mortgage-Related Investments Portfolio Limit

Investments – Purchase Agreement portfolio limits

Indebtedness 1, 3

$ Billions

Mortgage Assets 1, 2

$ Billions

1 The company’s Purchase Agreement with Treasury limits the amount of mortgage assets the company can own and indebtedness it can incur. Under the Purchase Agreement,

mortgage assets and indebtedness are calculated without giving effect to the January 1, 2010 change in the accounting guidance related to the transfer of financial assets and

consolidation of variable interest entities (VIEs). See the company’s Annual Report on Form 10-K for the year ended December 31, 2015 for more information.

2 Represents the unpaid principal balance (UPB) of the company’s mortgage-related investments portfolio. The company discloses its mortgage assets on this basis monthly in its

Monthly Volume Summary reports, which are available on its Web site.

3 Represents the par value of the company’s unsecured short-term and long-term debt securities issued to third parties to fund its business activities. The company discloses its

indebtedness on this basis in its Monthly Volume Summary reports, which are available on its Web site.

$418 $391 $382

$564

$479 $479 $479 $479

12/31/15 3/31/16 6/30/16 9/30/16 12/31/16

Total Debt Outstanding

Indebtedness Limit

© Freddie Mac 10

$177

$144

$1,640

$1,827

$2,103

$2,207 $2,251

$2,165 $2,075

$1,956 $1,915 $1,910 $1,942 $1,961

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

2,400

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 YTD2016

$ Billions

Outstanding Freddie Mac Mortgage-Related Securities and Other Mortgage-Related Guarantees

Mortgage-related Investments Portfolio (PCs, REMICs and Other Securitization Products)

Mortgage-related Investments Portfolio (Non-Freddie Mac Mortgage-Related Securities & Mortgage Loans)

Note: Totals may not add due to rounding.

Source: Freddie Mac. 2016 data as of June 30, 2016.

$1,784

Total mortgage portfolio

$321

11 © Freddie Mac

Note: Estimates and forecasts by the Economic and Housing Research Department do not necessarily represent the views of Freddie Mac or its management, should not be

construed as indicating Freddie Mac's business prospects or expected results, and are subject to change without notice.

Source: U.S. Department of Housing and Urban Development and Federal Financial Institutions Examination Council. 2016 and 2017 data based on the July 2016 estimate of

Freddie Mac’s Economic and Housing Research Department.

Single-family mortgage originations

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016Fcst.

2017Fcst.

$ Billions

Home Purchase Originations Refinance Originations

$1.8T

$1.6T

© Freddie Mac 12

1

Mortgage-related investments portfolio

1 Represents the unpaid principal balance (UPB) of the company’s mortgage-related investments portfolio. The mortgage-related investments portfolio is determined without giving

effect to the January 1, 2010 change in accounting standards related to the transfer of financial assets and consolidation of variable interest entities (VIEs).

2 The mortgage-related investments portfolio limit as of December 31, 2016 under the Purchase Agreement, as amended on August 17, 2012.

3 Under FHFA regulation and the Purchase Agreement with Treasury, as amended on August 17, 2012, the company’s mortgage-related investments portfolio is subject to a cap

beginning in 2013 that decreases by 15% each year until the cap reaches $250 billion. Prior to the August 17, 2012 amendment, the portfolio was subject to a cap that decreased by

10% each year.

Source: Freddie Mac.

2,3

2

$755 $697 $653

$558 $461

$[VALUE] $347

$900

$810

$729

$650

$553

$470

$399

$339

12/31/09 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16

UPB $ Billions

Mortgage-related investments portfolio ending balance

Mortgage-related investments portfolio limit (changes on Dec. 31 annually)

Portfolio

Balance at

6/30/2016:

$321 Billion

© Freddie Mac 13

Source: Freddie Mac and Fannie Mae Monthly Volume Summaries. 2016 data as of June 30, 2016.

Freddie Mac Share of PC/MBS Issuances Percent (%)

Freddie Mac’s GSE market share

37%

38%

35% 35%

38%

41%

43%

42%

2009 2010 2011 2012 2013 2014 2015 YTD2016

14 © Freddie Mac

Home price performance by state

June 2015 to June 20161

United States 6%

1 The Freddie Mac House Price Index for the U.S. is a value-weighted average of the state indexes where the value weights are based on Freddie Mac’s single-family credit guarantee

portfolio. Other indices of home prices may have different results, as they are determined using different pools of mortgage loans and calculated under different conventions. The

Freddie Mac House Price Index for the U.S. is a non-seasonally adjusted monthly series. Percent changes were rounded to nearest whole percentage point.

Source: Freddie Mac

4%

AL 2%

AK

≥ 7%

4 to 6%

˂ 0%

0 to 3%

3%

AR 7%

AZ

8%

CA

11%

CO

CT -1%

DC 7%

DE 3%

11%

FL

8%

GA

9%

HI

2%

IA

8%

ID

3%

IL

5%

IN

6%

KS KY 5%

4%

LA

3%

4%

ME

6%

MI

6%

MN

5%

MO

3%

MS

5%

MT

NC 6%

2%

ND

4%

NE

NJ 2%

3%

NM

10%

NV

3%

NY

5%

OH

0%

OK

13%

OR

4%

PA

5%

SC

3%

SD

TN 7%

7%

TX

8%

UT 4%

VA

12%

WA

5%

WI

-1%

WV

2%

WY

5%

5%

MD

MA

NH

-1%

VT

RI 7%

© Freddie Mac 15

Freddie Mac’s total debt outstanding

Note: Totals may not recalculate due to rounding. Excludes debt securities of consolidated trusts held by third parties. All figures represent par amounts in USD billions based on trade

date. These figures could differ significantly from proceeds, amortized principal amount and book value figures, particularly for zero-coupon securities. For non-dollar denominated

instruments, the U.S. dollar amounts reflected are based on the exchange rate at issuance.

Source: Freddie Mac. 2016 data as of July 31, 2016.

1 Under the Purchase Agreement with Treasury, the company’s total debt outstanding is subject to a limit of $479 billion in 2016.

($ Billions)

Instrument Type 2012 2013 2014 2015 YTD 2016

Short Term Overnight Discount Notes $ - $ - $ - $ 1.0 $ 1.0

Reference Bills® & Discount Notes 118.5 137.8 134.7 103.1 71.7

Total Short Term $ 118.5 $ 137.8 $ 134.7 $ 104.1 $ 72.7

Medium Term Notes (MTNs) MTN Callable $ 99.0 $ 100.0 $ 98.2 $ 96.0 $ 97.1

Callables with Expired Options 7.0 9.0 11.1 12.3 13.4

MTN Other 102.2 71.7 53.8 56.2 64.3

Freddie Notes 1.2 0.8 0.1 - -

Total MTNs $ 209.5 $ 181.4 $ 163.2 $ 164.5 $ 174.8

Reference Notes® USD Reference Notes® $ 225.9 $ 190.4 $ 151.7 $ 137.2 $ 127.0

€Reference Notes® 1.0 0.5 - - -

Total Reference Notes® $ 226.8 $ 190.9 $ 151.7 $ 137.2 $ 127.0

Other Mortgage-Linked Amortizing Notes® $ 1.9 $ 1.0 $ 0.6 $ 0.5 $ 0.4

Structured Agency Credit Risk Debt Notes $ - $ 1.1 $ 5.9 $ 11.6 $ 14.3

Subordinated Debt $ 0.6 $ 0.6 $ 0.6 $ 0.6 $ 0.5

Total Debt Outstanding1 $ 557.3 $ 512.7 $ 456.7 $ 418.4 $ 389.6

© Freddie Mac 16

Freddie Mac’s outstanding debt by type

Note: Excludes debt securities of consolidated trusts held by third parties. All figures represent par amounts in USD billions based on settlement date. These figures could differ

significantly from proceeds, amortized principal amount and book value figures, particularly for zero-coupon securities.

Source: Freddie Mac.

$412 $413 $412 $403 $391

$418 $412 $402

$391 $379 $375 $381 $387

Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16

$ Billions

Discount Notes Term Callable Debt Term Bullet Debt

17 © Freddie Mac

Note: Totals may not recalculate due to rounding. Outstanding balance using par amounts based on settle date. Short-term debt is debt with an original maturity of less than or equal to

one year, except certain medium-term notes that have original maturities of one year or less are categorized as long-term debt. Excludes debt securities of consolidated trusts held by

third parties.

Source: Freddie Mac. Data as of July 31, 2016.

Debt maturity profile

$32

$95

$62

$11

0

20

40

60

80

100

120

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027+

Long-term Short-term

$ Billions

18 © Freddie Mac

Note: Totals may not recalculate due to rounding. Outstanding balance using par amounts based on settle date. Short-term debt is debt with an original maturity of less than or equal

to one year, except certain medium-term notes that have original maturities of one year or less are categorized as long-term debt. Excludes debt securities of consolidated trusts

held by third parties.

Source: Freddie Mac. Data as of July 31, 2016.

Debt maturity profile by quarter

$14 $18

$28

$21 $25

$22

$27

$34 $10

$1

$0

0

10

20

30

40

50

60

3Q16 4Q16 1Q17 2Q17 3Q17 4Q17

Long-term Short-term

$ Billions

© Freddie Mac 19

Freddie Mac callable debt issued and called

Note: All figures represent par amounts in USD billions based on the trade date.

Source: Freddie Mac. Data as of July 31, 2016.

Callable Debt

$11

$3 $4 $5

$9 $8 $9 $8

$10 $11

$17

$10

$7 $9

$11

$17

$10

$8

$4

$15

$12

$16

$12 $14

$12

($4) ($2)

($1)

($9) ($7)

($3) ($4) ($1)

($9) ($9)

($16)

($22)

($5) ($7)

($21)

($17)

($10)

($2) ($2)

($13) ($13)

($8)

($13)

($22)

($12)

(30)

(20)

(10)

0

10

20

30

Jul-14 Jan-15 Jul-15 Jan-16 Jul-16

Called

$ Billions

Issued

© Freddie Mac 20

Short-term debt balances

Total Short-term Debt Outstanding Total Short-term Debt Outstanding

as a % of Total Debt Outstanding

Note: Outstanding balance using par amounts based on settle date. Short-term debt is debt with an original maturity of less than or equal to one year, except certain medium-term

notes that have original maturities of one year or less are categorized as long-term debt. Excludes debt securities of consolidated trusts held by third parties.

Source: Freddie Mac. 2016 data as of June 30, 2016.

0

50

100

150

200

250

300

350

2Q07 4Q08 2Q10 4Q11 2Q13 4Q14 2Q16

$ Billions

15%

20%

25%

30%

35%

40%

2Q07 4Q08 2Q10 4Q11 2Q13 4Q14 2Q16

Average= 25%

© Freddie Mac 21

Safe Harbor Statements

Freddie Mac obligations

Freddie Mac’s securities are obligations of Freddie Mac only. The securities, including any interest or return of discount on the securities, are not guaranteed by and are not debts or obligations of the United States or any federal agency or instrumentality other than Freddie Mac.

No offer or solicitation of securities

This presentation includes information related to, or referenced in the offering documentation for, certain Freddie Mac securities, including offering circulars and related supplements and agreements. Freddie Mac securities may not be eligible for offer or sale in certain jurisdictions or to certain persons. This information is provided for your general information only, is current only as of its specified date and does not constitute an offer to sell or a solicitation of an offer to buy securities. The information does not constitute a sufficient basis for making a decision with respect to the purchase or sale of any security. All information regarding or relating to Freddie Mac securities is qualified in its entirety by the relevant offering circular and any related supplements. Investors should review the relevant offering circular and any related supplements before making a decision with respect to the purchase or sale of any security. In addition, before purchasing any security, please consult your legal and financial advisors for information about and analysis of the security, its risks and its suitability as an investment in your particular circumstances.

Forward-looking statements

Freddie Mac's presentations may contain forward-looking statements, which may include statements pertaining to the conservatorship, the company’s current expectations and objectives for its Single-Family Guarantee, Multifamily and Investments segments, its loan workout initiatives and other efforts to assist the U.S. residential mortgage market, liquidity, capital management, economic and market conditions and trends, market share, the effect of legislative and regulatory developments and new accounting guidance, credit quality of loans the company guarantees, and results of operations and financial condition on a GAAP, Segment Earnings, non-GAAP and fair value basis. Forward-looking statements involve known and unknown risks and uncertainties, some of which are beyond the company’s control. Management’s expectations for the company’s future necessarily involve a number of assumptions, judgments and estimates, and various factors, including changes in market conditions, liquidity, mortgage spreads, credit outlook, actions by the U.S. government (including FHFA, Treasury and Congress), and the impacts of legislation or regulations and new or amended accounting guidance, could cause actual results to differ materially from these expectations. These assumptions, judgments, estimates and factors are discussed in the company’s Annual Report on Form 10-K for the year ended December 31, 2015, Quarterly Reports on Form 10-Q for the quarters ended March 31, 2016 and June 30, 2016 and Current Reports on Form 8-K, which are available on the Investor Relations page of the company’s Web site at www.FreddieMac.com/investors and the SEC’s Web site at www.sec.gov. The company undertakes no obligation to update forward-looking statements it makes to reflect events or circumstances occurring after the date of this presentation.