Fannie Mae 2012 Annual Report Download - page 268

FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
F-34
agreements with the borrower that do not result in the legal modification of the loan’s contractual terms. We account for these
informal restructurings as a TDR if we defer more than three missed payments. We also classify as TDRs loans to certain
borrowers who have received bankruptcy relief.
The substantial majority of the loan modifications we complete result in term extensions, interest rate reductions or a
combination of both. During the years ended December 31, 2012 and 2011, the average term extension of a single-family
modified loan was 131 and 90 months, respectively, and the average interest rate reduction was 2.15 and 2.95 percentage
points, respectively.
The following table displays the number of loans and recorded investment in loans restructured in a TDR for the years ended
December 31, 2012 and 2011.
For the Year Ended December 31,
2012 2011
Number of
Loans Recorded
Investment(1) Number of Loans Recorded
Investment(1)
(Dollars in millions)
Single-family:
Primary (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270,913 $ 39,527 160,227 $ 28,329
Government (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394 50 497 86
Alt-A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,572 9,116 33,416 7,108
Other (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,484 3,489 14,724 3,644
Total single-family . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337,363 52,182 208,864 39,167
Multifamily . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 324 47 223
Total troubled debt restructurings . . . . . . . . . . . . . . . . . . . . . . . . . 337,409 $ 52,506 208,911 $ 39,390
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(1) Recorded investment consists of unpaid principal balance, unamortized premiums, discounts and other cost basis adjustments, and
accrued interest receivable. Based on the nature of our modification programs, which do not include principal or past-due interest
forgiveness, there is not a material difference between the recorded investment in our loans pre- and post- modification, therefore
amounts represent recorded investment post-modification.
(2) Consists of mortgage loans that are not included in other loan classes.
(3) Consists of mortgage loans guaranteed or insured, in whole or in part, by the U.S. government or one of its agencies that are not Alt-A.
(4) Includes loans with higher-risk characteristics, such as interest-only loans and negative-amortizing loans that are neither government
nor Alt-A.
The following table displays the number of loans and recorded investment in loans that had a payment default for the years
ended December 31, 2012 and 2011 and were modified in a TDR in the twelve months prior to the payment default. For
purposes of this disclosure, we define loans that had a payment default as: single-family and multifamily loans with
completed TDRs that liquidated during the period, either through foreclosure, deed-in-lieu of foreclosure or a short sale;
single-family loans with completed modifications that are two or more months delinquent during the period; or multifamily
loans with completed modifications that are one or more months delinquent during the period.
For the Year Ended December 31,
2012 2011
Number of
Loans Recorded
Investment (1) Number of Loans Recorded
Investment (1)
(Dollars in millions)
Single-family:
Primary (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,824 $ 7,828 66,088 $ 11,585
Government (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200 33 376 95
Alt-A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,848 1,761 14,223 3,045
Other (4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,011 948 6,843 1,670
Total single-family . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,883 10,570 87,530 16,395
Multifamily . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 35 8 49
Total TDRs that subsequently defaulted . . . . . . . . . . . . . . . . . . . . . 59,890 $10,605 87,538 $ 16,444