Fannie Mae to Purchase
Delinquent Loans from Single-Family MBS Trusts — Additional Information
Fannie Mae (FNM/NYSE)
announced that it intends to
increase significantly its purchases of loans from single-family MBS trusts
that are delinquent as to four or more consecutive monthly payments.
As
noted in the February 10th
announcement, the total dollar volume (measured by scheduled unpaid
principal balance) of all loans that were four or more months delinquent in
our single-family MBS as of December 31, 2009 was approximately $127
billion. Of that amount, approximately $82 billion backed our CL prefix MBS
and approximately $45 billion backed our non-CL prefix MBS.
The attached
chart provides information regarding
delinquent loans backing our CL prefix MBS and our non-CL prefix MBS. The
information is categorized by MBS pass-through rates with corresponding
product type and vintage information (year of MBS issuance). The chart shows
both the total scheduled unpaid principal balances of loans that were four
or more months delinquent as of December 31, 2009 and those balances as a
percentage of total scheduled unpaid principal balances of all loans in the
related MBS as of that date. The disclosure includes seven categories of
fixed-rate mortgage loan product (organized by MBS prefix), two categories
of adjustable-rate mortgage loan product, and an additional category
(designated as "other") that includes all remaining loan products.
We anticipate that we
will purchase approximately 150,000 — 200,000 loans from MBS trusts in the
month of March, and expect that we will continue purchasing loans in each of
the subsequent few months until we have substantially reduced the current
population of loans that are four or more months delinquent. March 2010
purchases of loans that are four or more months delinquent will be reflected
in the MBS pool factors released on the fourth business day of April 2010.
Loans that become four or more months delinquent after December 31, 2009
will be included in the purchase population as they become eligible.
Generally, when
determining which loans to purchase, priority will be given to mandatory
purchases (such as modified loans and loans that become 24 months
delinquent), loans in MBS having the highest MBS pass-through rates, loans
backing CL or CI prefixes, and lastly, loans having the highest unpaid
principal balances. To enhance visibility of purchase activity for security
holders, Fannie Mae plans to provide monthly updates of the table through
the end of 2010. This table will be available on www.fanniemae.com on the
fourth business day of the month (coinciding with the publication of monthly
MBS pool factors) and will reflect loans that were four or more months
delinquent as of the date specified in that month's table heading.
Investors should
consult our June 1, 2009 MBS Prospectus for additional information regarding
our trust agreement provisions and servicing practices regarding troubled
loans, including purchases of delinquent loans from MBS trusts.
Certain statements in this announcement may
be considered forward-looking statements within the meaning of the federal
securities laws, including statements about our plans to purchase loans from
trusts. Factors that may cause actual results to differ materially from the
expectations in these and other forward-looking statements include servicer
capacity issues as well as those discussed in our Annual Report on Form 10-K
for the year ended December 31, 2009 and our reports on Form 10-Q and Form
8-K, filed with the SEC and available on the Investors page of our Web site
at
www.fanniemae.com and the SEC's Web
site at
www.sec.gov.
