Fannie Mae 2010 Annual Report Download - page 16

Performance of Our Single-Family Acquisitions
In our experience, an early predictor of the ultimate performance of loans is the rate at which the loans
become seriously delinquent within a short period of time after acquisition. Loans we acquired in 2009 have
experienced historically low levels of delinquencies shortly after their acquisition. Table 2 shows, for single-
family loans we acquired in each year from 2001 to 2009, the percentage that were seriously delinquent (three
or more months past due or in the foreclosure process) as of the end of the fourth quarter following the
acquisition year. Loans we acquired in 2010 are not included in this table because a substantial portion of
them were originated so recently that they could not yet have become seriously delinquent. As Table 2 shows,
the percentage of our 2009 acquisitions that were seriously delinquent as of the end of the fourth quarter
following their acquisition year was more than nine times lower than the average comparable serious
delinquency rate for loans acquired in 2005 through 2008. Table 2 also shows serious delinquency rates for
each year’s acquisitions as of December 31, 2010. Except for the most recent acquisition years, whose serious
delinquency rates are likely lower than they will be after the loans have aged, Table 2 shows that the serious
delinquency rate as of December 31, 2010 generally tracks the trend of the serious delinquency rate as of the
end of the fourth quarter following the year of acquisition. Below the table we provide information about the
economic environment in which the loans were acquired, specifically home price appreciation and
unemployment levels.
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