Fannie Mae 2008 Annual Report Download - page 346

9. Acquired Property, Net
Acquired property, net consists of foreclosed property received in full satisfaction of a loan net of a valuation
allowance for declines in the fair value of foreclosed properties after initial acquisition. The following table
displays the activity in acquired property and the related valuation allowance for the years ended
December 31, 2008, 2007 and 2006.
Acquired
Property
Valuation
Allowance
(1)
Acquired
Property, Net
(Dollars in millions)
Balance, January 1, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,851 $ (80) $ 1,771
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,255 (159) 3,096
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,849) 140 (2,709)
Write-downs, net of recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (17) (17)
Balance, December 31, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,257 (116) 2,141
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,131 (18) 5,113
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,535) 291 (3,244)
Write-downs, net of recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (408) (408)
Balance, December 31, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,853 (251) 3,602
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,853 (75) 10,778
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,666) 664 (6,002)
Write-downs, net of recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (1,460) (1,460)
Balance, December 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,040 $(1,122) $ 6,918
(1)
Reflects activities in the valuation allowance for acquired properties held primarily by our Single-Family segment.
The following table displays the carrying amount of acquired properties held for use for the years ended
December 31, 2008, 2007 and 2006.
2008 2007 2006
For the Year Ended
December 31,
(Dollars in millions)
Beginning balance, January 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $107 $ 224 $118
Transfers in from held for sale, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 4 193
Transfers to held for sale, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (93) (113) (76)
Depreciation and asset write-downs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4) (8) (11)
Ending balance, December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11 $ 107 $224
10. Short-term Borrowings and Long-term Debt
We obtain the funds to finance our mortgage purchases and other business activities primarily by selling debt
securities in the domestic and international capital markets. We issue a variety of debt securities to fulfill our
ongoing funding needs.
Short-term Borrowings
Our short-term borrowings (borrowings with an original contractual maturity of one year or less) consist of
both “Federal funds purchased and securities sold under agreements to repurchase” and “Short-term debt” in
F-68
FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)