Fannie Mae’s 8k has an interesting slide. It is a look at their questionable assets. The slide is not easy to read. It can be found in the 2009 Second Quarter Supplement, on page 5.
The report describes FNM’s exposure to problematic classes of mortgages on their book. That total comes to a whopping .9 Trillion. The total book of business is $2.7 Trillion, fully 32% of their book is troubled.
The report muddles with the actual holdings, as there are overlaps in the descriptions. The actual numbers they provide include:
Negative Amortization Loans: $15b
Interest Only: $196B
Low Fico: $328B
LTV>90%: $265B
Alt-A: $269B
Sub Prime: $8B
Those numbers add up to $1.2 trillion. What this means is that 50% of the bad loans on the books are troubled for two reasons. For example, $25 billion are loans that have high LTV and a FICO score less than 620. (AKA a “stinker”)
FNM Has .9 Trillion of Troubled Loans - 8K | zero hedge
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