Fannie Mae 2010 Annual Report Download - page 50

originations in the primary mortgage market. We will be in compliance with the housing goals if we meet
either the benchmarks or market share measures.
The final rule also established a new multifamily goal and subgoal. For each of 2010 and 2011, our
multifamily mortgage acquisitions must finance at least 177,750 units affordable to low-income families, and
at least 42,750 units affordable to very low-income families. There is no market-based alternative
measurement for the multifamily goals.
FHFA’s final rule made significant changes to prior housing goals regulations regarding the types of products
that count towards the housing goals. Private-label mortgage-related securities, second liens and single-family
government loans do not count towards the housing goals. In addition, only permanent modifications of
mortgages under HAMP completed during the year will count towards the housing goals; trial modifications
will not be counted. Moreover, these modifications will count only towards the single-family low-income
families refinance goal, not any of the home purchase goals.
The final rule notes that “FHFA does not intend for [Fannie Mae] to undertake uneconomic or high-risk
activities in support of the [housing] goals. However, the fact that [Fannie Mae is] in conservatorship should
not be a justification for withdrawing support from these market segments.” If our efforts to meet our goals
prove to be insufficient, FHFA will determine whether the goals were feasible. If FHFA finds that our goals
were feasible, we may become subject to a housing plan that could require us to take additional steps that
could have an adverse effect on our results of operations and financial condition. The housing plan must
describe the actions we would take to meet the goal in the next calendar year and be approved by FHFA. The
potential penalties for failure to comply with housing plan requirements include a cease-and-desist order and
civil money penalties. See “Risk Factors” for a description of how we may be unable to meet our housing
goals and how actions we may take to meet these goals and other regulatory requirements could adversely
affect our business, results of operations and financial condition.
The following table presents our performance against our 2010 single-family housing benchmarks and
multifamily housing goals. These performance results have not yet been validated by FHFA.
2010 Housing Goals Performance
Result
(1)
Benchmark
(2)
Single-family housing goals:
(3)
Low-income families home purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.1% 27.0%
Very low-income families home purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2 8.0
Low-income areas home purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.0 24.0
Low-income and high-minority areas home purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.4 13.0
Low-income families refinancing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.9 21.0
Result
(1)
Goal
Multifamily housing goals:
Affordable to families with incomes no higher than 80% of area median income . . . . . 212,768 units 177,750 units
Affordable to families with incomes no higher than 50% of area median income . . . . . 53,184 units 42,750 units
(1)
Our 2010 results have not been validated by FHFA, and after validation they may differ from the results reported
above.
(2)
Even if our results do not meet the benchmarks, we may still meet our goals. The final rule specifies that our single-
family housing goals performance will be measured not only against these benchmarks, but also against the share of
goals-qualifying originations in the primary mortgage market. We will be in compliance with the housing goals if we
meet either the benchmarks or market share measures. The amount of goals-qualifying originations in the market
during 2010 will not be available until the release of data reported by primary market originators under the Home
Mortgage Disclosure Act in the fall of 2011.
(3)
Our single-family results and benchmarks are expressed as a percentage of the total number of eligible mortgages
acquired during the period.
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