|FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE filed this Form 8-K on 01/07/2013|
Item 8.01 Other Events.
Repurchase Request Resolution Agreement
On January 6, 2013, Fannie Mae (formally, the Federal National Mortgage Association) entered into an agreement (the resolution agreement) with Bank of America, N.A., Countrywide Home Loans, Inc., and other parties, each of which is an affiliate of Bank of America Corporation, to resolve certain repurchase requests arising from breaches of selling representations and warranties. Bank of America Corporation acquired Countrywide Financial Corporation and its subsidiaries (collectively, Countrywide) in 2008. In this report, Bank of America Corporation and its affiliates are referred to individually and collectively as Bank of America.
Our mortgage seller/servicers are obligated to either repurchase loans or foreclosed properties, or reimburse us for our losses, if we determine that the mortgage loans did not meet our underwriting, eligibility or other requirements in place at the time we acquired the loans. We refer to our requests to seller/servicers to honor these obligations collectively as repurchase requests.
The resolution agreement resolves Fannie Maes currently outstanding and expected future repurchase requests arising from breaches of selling representations and warranties on specified single-family loans delivered to Fannie Mae by Bank of America and Countrywide that were originated between January 1, 2000 and December 31, 2008. These loans had an outstanding unpaid principal balance of $297 billion as of November 30, 2012. Fannie Mae entered into the resolution agreement to compensate us for actual and projected losses resulting from the loans covered by the agreement that did not meet our underwriting requirements.
Bank of America will pay Fannie Mae approximately $10.3 billion pursuant to the resolution agreement, as follows: