Freddie Mac 2010 Annual Report Download - page 143

Table 54 provides detail on non-performing loans and REO assets on our consolidated balance sheets and non-
performing loans underlying our financial guarantees.
Table 54 — Non-Performing Assets
(1)
2010 2009 2008 2007 2006
December 31,
(dollars in millions)
Non-performing mortgage loans — on balance sheet:
Single-family TDRs:
Reperforming or less than three monthly payments past due . . . . . . .......... $ 26,612 $ 711 $ 484 $ 282 $ 323
Seriously delinquent ........................................... 3,144 477 163 67 87
Multifamily TDRs . . ............................................ 911 229 150 167 216
Total TDRs . . . . . ............................................ 30,667 1,417 797 516 626
Other single-family non-performing loans
(2)(3)
........................... 84,272 12,106 5,590 5,842 3,335
Other multifamily non-performing loans
(4)
.............................. 1,750 1,196 197 188 257
Total non-performing mortgage loans — on balance sheet .................. 116,689 14,719 6,584 6,546 4,218
Non-performing mortgage loans — off-balance sheet:
Single-family loans
(3)
............................................ 1,450 85,395 36,718 7,786 2,718
Multifamily loans . . . ............................................ 198 178 63 51 82
Total non-performing mortgage loans — off-balance sheet .................. 1,648 85,573 36,781 7,837 2,800
Real estate owned, net . ............................................ 7,068 4,692 3,255 1,736 743
Total non-performing assets.......................................... $125,405 $104,984 $46,620 $16,119 $7,761
Loan loss reserves as a percentage of our non-performing mortgage loans . . ..... 33.7% 33.8% 36.0% 19.6% 8.8%
Total non-performing assets as a percentage of the total mortgage portfolio, excluding
non-Freddie Mac securities . . . ..................................... 6.4% 5.2% 2.4% 0.9% 0.5%
(1) Mortgage loan amounts are based on UPB and REO, net is based on carrying values.
(2) Represents loans recognized by us on our consolidated balance sheets, including loans purchased from PC trusts due to the borrower’s serious
delinquency.
(3) The significant increase in other single-family non-performing loans — on balance sheet and the significant decrease in the non-performing single-
family mortgage loans off-balance sheet from December 31, 2009 to December 31, 2010 is primarily related to the adoption of amendments of the
accounting standards for transfers of financial assets and consolidation of VIEs. See “NOTE 2: CHANGE IN ACCOUNTING PRINCIPLES” for further
information.
(4) Of this amount, $1.6 billion and $1.1 billion were current at December 31, 2010 and 2009, respectively.
The amount of non-performing assets increased to approximately $125.4 billion as of December 31, 2010, from
$105.0 billion at December 31, 2009, primarily due to continued high transition of loans into serious delinquency, which led
to higher volumes of loan modifications and, consequently, a rise in the number of loans categorized as TDRs. Serious
delinquencies have remained high due to the impact of continued weakness in home prices and persistently high
unemployment, extended foreclosure timelines and foreclosure suspensions in many states, and challenges faced by servicers
in building capacity to service high volumes of problem loans. The UPB of loans categorized as TDRs increased to
$30.7 billion at December 31, 2010 from $1.4 billion as of December 31, 2009, largely due to a significant increase in loan
modifications during 2010 in which we decreased the contractual interest rate, deferred the balance on which contractual
interest is computed, or made a combination of both of these changes. Many of the TDRs during 2010 were loan
modifications under HAMP, but an increasing number of our non-HAMP modifications have similar changes in terms,
excluding forbearance of principal amounts. We expect the number of non-HAMP modifications to continue to increase in
2011. We expect our non-performing assets, including loans deemed to be TDRs, to increase in 2011.
Table 55 provides detail by region for REO activity. Our REO activity relates almost entirely to single-family residential
properties. Consequently, our regional REO acquisition trends generally follow a pattern that is similar to, but lags, that of
140 Freddie Mac