Ally Bank 2011 Annual Report Download - page 234

Table of Contents
Notes to Consolidated Financial Statements
Ally Financial Inc. • Form 10−K
inclusion in the transaction, including compliance with underwriting standards or loan criteria established by the buyer, ability to deliver required
documentation, and compliance with applicable laws. Generally, the representations and warranties described above may be enforced against the applicable
Mortgage Companies at any time over the life of the loan. Breaches of these representations and warranties have resulted in a requirement that the
applicable Mortgage Companies repurchase mortgage loans. As the mortgage industry continues to experience higher repurchase requirements and
additional investors begin to attempt to put back loans, a significant increase in activity beyond that experienced today could occur, resulting in additional
future losses at our Mortgage Companies.
Potential Losses
We believe it is reasonably possible that losses beyond amounts currently reserved for the litigation matters and potential repurchase obligations and
related claims described above with respect to our Mortgage Companies could occur, and such losses could have a material adverse impact on our results of
operations, financial position, or cash flows. However, based on currently available information, we are unable to estimate a range of reasonably possible
losses above reserves that have been established.
Other Contingencies
We are subject to potential liability under various other exposures including tax, nonrecourse loans, self−insurance, and other miscellaneous
contingencies. We establish reserves for these contingencies when the item becomes probable and the costs can be reasonably estimated. The actual costs of
resolving these items may be substantially higher or lower than the amounts reserved for any one item. Based on information currently available, it is the
opinion of management that the eventual outcome of these items will not have a material adverse impact on our results of operations, financial position, or
cash flows.
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