Freddie Mac 2006 Annual Report Download - page 18

liquid and trade with similar securities on a ""generic'' basis, also referred to as trading in the To Be Announced, or TBA,
market. A TBA trade in Freddie Mac securities represents a contract for the purchase or sale of PCs to be delivered at a
future date; however, the speciÑc PCs that will be delivered to fulÑll the trade obligation, and thus the speciÑc
characteristics of the mortgages underlying those PCs, are not known (i.e., ""announced'') at the time of the trade, but only
shortly before the trade is settled. The Securities Industry and Financial Markets Association publishes guidelines pertaining
to the types of mortgages that are eligible for TBA trades.
The use of the TBA market increases the liquidity of mortgage investments and improves the distribution of investment
capital available for residential mortgage Ñnancing, thereby helping us to accomplish our statutory mission. During 2006, we
issued approximately $264.7 billion of PCs backed by single-family mortgage loans that were eligible to be delivered to
settle TBA trades, representing approximately 74 percent of our total guaranteed PCs and Structured Securities issuances.
Available Information
Our Information Statements, Supplements and other Ñnancial disclosure documents are available free of charge on our
website at www.freddiemac.com. (We do not intend this internet address to be an active link and are not using references to
this internet address here or elsewhere in this Information Statement to incorporate additional information into this
Information Statement.) Our corporate governance guidelines, Codes of Conduct for employees and members of the board
of directors (and any amendments or waivers that would be required to be disclosed) and the charters of the board's Ñve
standing committees (the Audit; Finance and Capital Deployment; Mission, Sourcing and Technology; Governance,
Nominating and Risk Oversight; and Compensation and Human Resources Committees) are also available on our website at
www.freddiemac.com. Printed copies of these documents may be obtained upon request from our Investor Relations
department.
REGULATION AND SUPERVISION
Department of Housing and Urban Development
The U.S. Department of Housing and Urban Development, or HUD, has general regulatory power over Freddie Mac,
including power over new programs, aÅordable housing goals and fair lending. HUD periodically conducts reviews of our
activities to ensure conformity with our charter and other regulatory obligations. For example, HUD is currently reviewing
certain of our investments and other assets and liabilities.
Housing Goals
We are subject to aÅordable housing goals set by HUD. The goals, which are set as a percentage of the total number of
dwelling units underlying our total mortgage purchases, have risen steadily since they became permanent in 1995. The goals
are intended to expand housing opportunities for low- and moderate-income families, low-income families living in low-
income areas, very low-income families and families living in HUD-deÑned underserved areas. The goal relating to low-
income families living in low-income areas and very low-income families is referred to as the ""special aÅordable'' housing
goal. This special aÅordable housing goal also includes a multifamily subgoal that sets an annual minimum dollar volume
of qualifying multifamily mortgage purchases. In addition, HUD has established three subgoals that are expressed as
percentages of the total number of mortgages we purchased that Ñnance the purchase of single-family, owner-occupied
properties located in metropolitan areas.
The HUD goals and subgoals are summarized in Table 2 below. Our performance with respect to the goals and
subgoals, as reported to HUD, is set forth in Table 3.
Table 2 Ì Housing Goals and Home Purchase Subgoals for 2006 through 2008(1)
Housing Goals
2008 2007 2006
Low- and moderate-income goal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 56% 55% 53%
Underserved areas goal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 39 38 38
Special aÅordable goal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 27 25 23
Multifamily special aÅordable volume target (dollars in billions) ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $3.92 $3.92 $3.92
Home Purchase Subgoals
2008 2007 2006
Low- and moderate-income subgoalÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 47% 47% 46%
Underserved areas subgoalÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 34 33 33
Special aÅordable subgoal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 18 18 17
(1) An individual mortgage may qualify for more than one of the goals or subgoals. Each of the goal and subgoal percentages will be determined
independently and cannot be aggregated to determine a percentage of total purchases that qualiÑes for these goals or subgoals.
6Freddie Mac