Fannie Mae 2009 Annual Report Download - page 369

The following table displays the percentage of our conventional single-family guaranty book of business that
consists of interest-only loans, negative-amortizing adjustable rate mortgages (“ARMs”) and loans with an
estimated mark-to-market loan to value (“LTV”) ratios greater than 80% as of December 31, 2009 and 2008.
2009 2008
Percentage of
Conventional Single-
Family Guaranty
Book of Business
As of December 31,
Interest-only loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7% 8%
Negative-amortizing ARMs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1
80%+LTVloans.................................................. 37 34
The following table displays information regarding the Alt-A and subprime mortgage loans and mortgage-
related securities in our single-family mortgage credit book of business as of December 31, 2009 and 2008.
Unpaid
Principal
Balance
Percent of
Book of
Business
(1)
Unpaid
Principal
Balance
Percent of
Book of
Business
(1)
2009 2008
As of December 31,
(Dollars in millions)
Loans and Fannie Mae MBS:
Alt-A
(2)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $251,111 8% $295,622 10%
Subprime
(3)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,268 1 19,086 1
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $267,379 9% $314,708 11%
Private-label securities:
Alt-A
(4)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 24,505 1% $ 27,858 1%
Subprime
(5)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,527 1 24,551 1
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 45,032 2% $ 52,409 2%
(1)
Calculated based on total unpaid principal balance of our single-family mortgage credit book of business.
(2)
Represents Alt-A mortgage loans held in our portfolio and Fannie Mae MBS backed by Alt-A mortgage loans.
(3)
Represents subprime mortgage loans held in our portfolio and Fannie Mae MBS backed by subprime mortgage loans.
(4)
Represents private-label mortgage-related securities backed by Alt-A mortgage loans.
(5)
Represents private-label mortgage-related securities backed by subprime mortgage loans.
Other Concentrations
Mortgage Servicers. Mortgage servicers collect mortgage and escrow payments from borrowers, pay taxes
and insurance costs from escrow accounts, monitor and report delinquencies, and perform other required
activities on our behalf. Our business with mortgage servicers is concentrated. Our ten largest single-family
mortgage servicers, including their affiliates, serviced 80% and 81% of our single-family mortgage credit book
of business as of December 31, 2009 and 2008, respectively. Our ten largest multifamily mortgage servicers
including their affiliates serviced 75% of our multifamily mortgage credit book of business as of both
December 31, 2009 and 2008.
If one of our principal mortgage servicers fails to meet its obligations to us, it could increase our credit-related
expenses and credit losses, result in financial losses to us and have a material adverse effect on our earnings,
liquidity, financial condition and net worth.
F-111
FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)