10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2019

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from                                       to

Commission File Number: 001-34139

Federal Home Loan Mortgage Corporation

(Exact name of registrant as specified in its charter)

Federally chartered	52-0904874	8200 Jones Branch Drive			22102-3110		(703)	903-2000
corporation			McLean,	Virginia
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)	(Address of principal executive offices)			(Zip Code)	(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: 

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	N/A	N/A

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    ☒ Yes    ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    ☒ Yes    ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of October 15, 2019, there were 650,059,033 shares of the registrant’s common stock outstanding.

Table of Contents

Table of Contents

	Page
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	1
n    Introduction	1
n    Market Conditions and Economic Indicators	4
n    Consolidated Results of Operations	6
n    Consolidated Balance Sheets Analysis	12
n    Our Business Segments	13
n    Risk Management	37
n    Liquidity and Capital Resources	42
n    Off-Balance Sheet Arrangements	48
n    Conservatorship and Related Matters	49
n    Regulation and Supervision	51
n    Forward-Looking Statements	53
FINANCIAL STATEMENTS	55
OTHER INFORMATION	124
CONTROLS AND PROCEDURES	126
EXHIBIT INDEX	128
SIGNATURES	129
FORM 10-Q INDEX	130

Freddie Mac Form 10-Q i

Table of Contents

MD&A TABLE INDEX

Table	Description	Page
1	Summary of Consolidated Statements of Comprehensive Income (Loss)	6
2	Components of Net Interest Income	7
3	Analysis of Net Interest Yield	8
4	Components of Mortgage Loans Gains (Losses)	10
5	Components of Debt Gains (Losses)	10
6	Components of Derivative Gains (Losses)	10
7	Summarized Consolidated Balance Sheets	12
8	Single-Family Credit Guarantee Portfolio CRT Issuance	18
9	Details of Credit Enhanced Loans in Our Single-Family Credit Guarantee Portfolio	19
10	Single-Family Credit Guarantee Portfolio Attribute Combinations for Higher Risk Loans	21
11	Alt-A Loans in Our Single-Family Credit Guarantee Portfolio	22
12	Single-Family Credit Guarantee Portfolio Credit Performance Metrics	23
13	Single-Family Individually Impaired Loans with an Allowance Recorded	23
14	Single-Family TDR and Non-Accrual Loans	23
15	Single-Family REO Activity	24
16	Single-Family Guarantee Segment Financial Results	25
17	Multifamily Market Support	27
18	Multifamily Segment Financial Results	33
19	Capital Markets Segment Financial Results	36
20	Capital Markets Segment Interest Rate-Related and Market Spread-Related Fair Value Changes, Net of Tax	36
21	PVS-YC and PVS-L Results Assuming Shifts of the LIBOR Yield Curve	37
22	Duration Gap and PVS Results	38
23	PVS-L Results Before Derivatives and After Derivatives	38
24	PVS-L Average, Minimum, and Maximum	38
25	GAAP Adverse Scenario Before and After Hedge Accounting	39
26	GAAP Adverse Scenario Average, Minimum, and Maximum	39
27	Estimated Net Interest Rate Effect on Comprehensive Income (Loss)	40
28	Estimated Spread Effect on Comprehensive Income (Loss)	41
29	Sources of Liquidity	42
30	Other Investments Portfolio	42
31	Sources of Funding	43
32	Other Debt Activity	44
33	Activity for Debt Securities of Consolidated Trusts Held by Third Parties	46
34	Net Worth Activity	46
35	Return on Conservatorship Capital	47
36	Mortgage-Related Investments Portfolio Details	49
37	2018 Affordable Housing Goal Results	52

Freddie Mac Form 10-Q ii

Management's Discussion and Analysis Introduction

Management's Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q includes forward-looking statements that are based on current expectations and are subject to significant risks and uncertainties. These forward-looking statements are made as of the date of this Form 10-Q. We undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date of this Form 10-Q. Actual results might differ significantly from those described in or implied by such statements due to various factors and uncertainties, including those described in the Forward-Looking Statements section of this Form 10-Q, the Risk Factors section of our Form 10-Q for the quarter ended June 30, 2019 and the Business, Forward-Looking Statements, and Risk Factors sections of our Annual Report on Form 10-K for the year ended December 31, 2018, or 2018 Annual Report.

Throughout this Form 10-Q, we use certain acronyms and terms that are defined in the Glossary of our 2018 Annual Report.

You should read the following MD&A in conjunction with our 2018 Annual Report and our condensed consolidated financial statements and accompanying notes for the three and nine months ended September 30, 2019 included in Financial Statements. Throughout this Form 10-Q, we refer to the three months ended September 30, 2019, the three months ended June 30, 2019, the three months ended March 31, 2019, the three months ended December 31, 2018, the three months ended September 30, 2018, the three months ended June 30, 2018, the three months ended March 31, 2018, and the three months ended December 31, 2017 as "3Q 2019," "2Q 2019," "1Q 2019," "4Q 2018," "3Q 2018," "2Q 2018," "1Q 2018," and "4Q 2017," respectively. We refer to the nine months ended September 30, 2019 and the nine months ended September 30, 2018 as "YTD 2019" and "YTD 2018," respectively.

INTRODUCTION

Freddie Mac is a GSE chartered by Congress in 1970. Our public mission is to provide liquidity, stability, and affordability to the U.S. housing market. We do this primarily by purchasing residential mortgage loans originated by lenders. In most instances, we package these loans into mortgage-related securities, which are guaranteed by us and sold in the global capital markets. In addition, we transfer mortgage credit risk exposure to private investors through our credit risk transfer programs, which include securities- and insurance-based offerings. We also invest in mortgage loans and mortgage-related securities. We do not originate loans or lend money directly to mortgage borrowers.

We support the U.S. housing market and the overall economy by enabling America's families to access mortgage loan funding with better terms and by providing consistent liquidity to the multifamily mortgage market. We have helped many distressed borrowers keep their homes or avoid foreclosure. We are working with FHFA, our customers, and the industry to build a better housing finance system for the nation.

Business Results

Consolidated Financial Results⁽¹⁾

(1) Net revenues consist of net interest income, guarantee fee income, and other income (loss).

Freddie Mac Form 10-Q 1

Management's Discussion and Analysis Introduction

Comprehensive income for 3Q 2019 was $1.8 billion, demonstrating strong business performance in a challenging interest rate environment. Net revenues declined $0.8 billion, or 21%, from 3Q 2018 largely due to lower net interest income. Market-related losses were $0.3 billion in 3Q 2019, primarily due to the decline in long-term interest rates.

Our total equity, which is also our Net Worth Amount under the Purchase Agreement with Treasury, was $6.7 billion at September 30, 2019. On September 27, 2019, the Conservator, acting on our behalf, entered into a Letter Agreement with Treasury (the September 2019 Letter Agreement), increasing the applicable Capital Reserve Amount used in calculating our dividend requirement to Treasury from $3.0 billion to $20.0 billion. As a result of this increase in our Capital Reserve Amount, we were not required to pay a dividend on the senior preferred stock to Treasury on September 30, 2019 based on our Net Worth Amount of $4.8 billion as of June 30, 2019, and we will not have a dividend requirement to Treasury in December 2019 based on our Net Worth Amount of $6.7 billion as of September 30, 2019.

The September 2019 Letter Agreement also provides that the liquidation preference of the senior preferred stock will be increased, at the end of each fiscal quarter, beginning on September 30, 2019, by an amount equal to the increase in the Net Worth Amount, if any, during the immediately prior fiscal quarter, until the liquidation preference has increased by $17.0 billion. As a result, the liquidation preference of the senior preferred stock increased from $75.6 billion to $77.5 billion on September 30, 2019 based on the $1.8 billion increase in our Net Worth Amount during 2Q 2019, and will increase to $79.3 billion on December 31, 2019 based on the $1.8 billion increase in our Net Worth Amount during 3Q 2019. See Note 2 for more information about our Purchase Agreement with Treasury.

The amount of available funding remaining under the Purchase Agreement is $140.2 billion and will be reduced by any future draws.

Portfolio Balances

Guarantee Portfolio

Investments Portfolio

Total Guarantee Portfolio

n Our total guarantee portfolio grew $120 billion, or 6%, from September 30, 2018 to September 30, 2019, driven by a 5% increase in our single-family credit guarantee portfolio and a 15% increase in our multifamily guarantee portfolio.

l The growth in our single-family credit guarantee portfolio was primarily driven by an increase in U.S. single-family mortgage debt outstanding as a result of continued home price appreciation and our overall share of the single-family

Freddie Mac Form 10-Q 2

Management's Discussion and Analysis Introduction

mortgage market. New business acquisitions had a higher average loan size compared to older vintages that continued to run off.

l The growth in our multifamily guarantee portfolio was primarily driven by strong loan purchase and securitization activity. Continued strong demand for multifamily financing and healthy multifamily market fundamentals resulted in continued growth in overall multifamily mortgage debt outstanding.

Total Investments Portfolio

n Our total investments portfolio at September 30, 2019 was relatively unchanged compared to September 30, 2018, primarily due to an increase in our other investments portfolio driven by higher near-term cash needs for upcoming debt maturities and anticipated calls of other debt, partially offset by a reduction in the balance of our mortgage-related investments portfolio pursuant to the portfolio limits established by the Purchase Agreement and FHFA. In February 2019, FHFA directed us to maintain the mortgage-related investments portfolio at or below $225 billion at all times.

Conservatorship and Government Support for Our Business

Since September 2008, we have been operating in conservatorship, with FHFA as our Conservator. The conservatorship and related matters significantly affect our management, business activities, financial condition, and results of operations. Our future is uncertain, and the conservatorship has no specified termination date. We do not know what changes may occur to our business model during or following conservatorship, including whether we will continue to exist.

Our Purchase Agreement with Treasury and the terms of the senior preferred stock we issued to Treasury also affect our business activities and are critical to keeping us solvent and avoiding the appointment of a receiver by FHFA under statutory mandatory receivership provisions. We believe that the support provided by Treasury pursuant to the Purchase Agreement currently enables us to have adequate liquidity to conduct normal business activities.

Treasury, as the holder of the senior preferred stock, is entitled to receive cumulative quarterly cash dividends, when, as, and if declared by the Conservator, acting as successor to the rights, titles, powers, and privileges of our Board of Directors. The dividends we have paid to Treasury on the senior preferred stock have been declared by, and paid at the direction of, the Conservator.

Under the August 2012 amendment to the Purchase Agreement, our cash dividend requirement each quarter is the amount, if any, by which our Net Worth Amount at the end of the immediately preceding fiscal quarter, less the applicable Capital Reserve Amount, exceeds zero. Pursuant to the September 2019 Letter Agreement, the Capital Reserve Amount is $20.0 billion. If for any reason we were not to pay our dividend requirement on the senior preferred stock in full in any future period, the unpaid amount would be added to the liquidation preference and our applicable Capital Reserve Amount would thereafter be zero. This would not affect our ability to draw funds from Treasury under the Purchase Agreement.

Under the September 2019 Letter Agreement, Freddie Mac and Treasury agreed to negotiate and execute an amendment to the Purchase Agreement that further enhances taxpayer protections by adopting covenants broadly consistent with recommendations for administrative reform contained in the Treasury's September 2019 Housing Reform Plan. For more information regarding Treasury's Plan, see Regulation and Supervision - Legislative and Regulatory Developments - Treasury Housing Reform Plan.

Freddie Mac Form 10-Q 3

Management's Discussion and Analysis Market Conditions and Economic Indicators

MARKET CONDITIONS AND ECONOMIC INDICATORS

The following graphs and related discussions present certain market and macroeconomic indicators that can significantly affect our business and financial results.

Interest Rates⁽¹⁾ 

(1) 30-year PMMS interest rates are as of the last week in each quarter.

Unemployment Rate

Source: U.S. Bureau of Labor Statistics.

n The 30-year Primary Mortgage Market Survey (PMMS) interest rate is indicative of what a consumer could expect to be offered on a first-lien prime conventional conforming home purchase mortgage with an LTV of 80%. Increases (decreases) in the PMMS rate typically result in decreases (increases) in refinancing activity and originations.

n Changes in the 10-year and 2-year LIBOR interest rates can significantly affect the fair value of our debt, derivatives, and mortgage and non-mortgage-related securities. In addition, the GAAP accounting treatment for our financial assets and liabilities, including derivatives (i.e., some are measured at amortized cost, while others are measured at fair value) creates variability in our GAAP earnings when interest rates change. We have elected hedge accounting for certain assets and liabilities in an effort to reduce GAAP earnings variability and better align GAAP results with the economics of our business.

n Changes in the 3-month LIBOR rate affect the interest earned on our short-term investments and interest expense on our short-term funding.

n Long-term rates continued their recent downward trend, resulting in further inversion of the yield curve. The 10-year LIBOR rate decreased 39 and 115 basis points during 3Q 2019 and YTD 2019, respectively.

n Changes in the national unemployment rate can affect several market factors, including the demand for both single-family and multifamily housing and the level of loan delinquencies.

n Continued job growth, a declining unemployment rate, and generally favorable economic conditions resulted in strong credit performance.

Freddie Mac Form 10-Q 4

Management's Discussion and Analysis Market Conditions and Economic Indicators

U.S. Single-Family Home Prices

Source: Freddie Mac House Price Index.

U.S. Single-Family Originations

Source: Inside Mortgage Finance dated October 25, 2019 (latest available IMF purchase/refinance information).

n Changes in home prices affect the amount of equity that borrowers have in their homes. As home prices decline, the severity of losses we incur on defaulted loans that we hold or guarantee increases because the amount we can recover from the property securing the loan decreases.

n Single-family home prices decreased 0.1% during 3Q 2019, compared to an increase of 0.3% during 3Q 2018. We expect home price growth will continue for full-year 2019, but grow at a slower pace than in full-year 2018.

n U.S. single-family loan origination volume increased to $700 billion in 3Q 2019 from $435 billion in 3Q 2018, driven by higher refinance volume as a result of lower average mortgage interest rates in 3Q 2019.

n We expect U.S. single-family home purchase volume to increase in 2019 as a result of market response to lower interest rates. Freddie Mac's single-family loan purchase volumes typically follow a similar trend.

Freddie Mac Form 10-Q 5

Management's Discussion and Analysis Consolidated Results of Operations

CONSOLIDATED RESULTS OF OPERATIONS

You should read this discussion of our consolidated results of operations in conjunction with our condensed consolidated financial statements and accompanying notes.

The table below compares our summarized consolidated results of operations.

Table 1 - Summary of Consolidated Statements of Comprehensive Income (Loss)

							Change											Change
(Dollars in millions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Net interest income		$2,410			$3,257			($847	)	(26	)%		$8,490			$9,278			($788	)	(8	)%
Guarantee fee income	231			209			22			11		670			603			67			11
Other income (loss)	146			79			67			85		389			648			(259		)	(40	)
Net revenues	2,787			3,545			(758		)	(21	)	9,549			10,529			(980		)	(9	)
Other non-interest income (loss):
Mortgage loans gains (losses)	1,702			94			1,608			1,711		4,174			233			3,941			1,691
Investment securities gains (losses)	164			(443		)	607			137		728			(1,024		)	1,752			171
Debt gains (losses)	(56		)	158			(214		)	(135	)	8			445			(437		)	(98	)
Derivative gains (losses)	(1,217		)	728			(1,945		)	(267	)	(4,912		)	2,974			(7,886		)	(265	)
Total other non-interest income (loss)	593			537			56			10		(2		)	2,628			(2,630		)	(100	)
Benefit (provision) for credit losses	179			380			(201		)	(53	)	474			377			97			26
Non-interest expense	(1,423		)	(1,200		)	(223		)	(19	)	(4,222		)	(3,453		)	(769		)	(22	)
Income (loss) before income tax (expense) benefit	2,136			3,262			(1,126		)	(35	)	5,799			10,081			(4,282		)	(42	)
Income tax (expense) benefit	(427		)	(556		)	129			23		(1,177		)	(1,946		)	769			40
Net income (loss)	1,709			2,706			(997		)	(37	)	4,622			8,135			(3,513		)	(43	)
Total other comprehensive income (loss), net of taxes and reclassification adjustments	139			(147		)	286			195		717			(991		)	1,708			172
Comprehensive income (loss)		$1,848			$2,559			($711	)	(28	)%		$5,339			$7,144			($1,805	)	(25	)%

Freddie Mac Form 10-Q 6

Management's Discussion and Analysis Consolidated Results of Operations

Net Interest Income

The table below presents the components of net interest income.

Table 2 - Components of Net Interest Income

							Change											Change
(Dollars in millions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Guarantee portfolio net interest income:
Contractual net interest income		$943			$869			$74		9	%		$2,751			$2,561			$190		7	%
Net interest income related to the Temporary Payroll Tax Cut Continuation Act of 2011	405			364			41			11		1,172			1,067			105			10
Amortization	564			820			(256		)	(31	)	1,521			2,269			(748		)	(33	)
Total guarantee portfolio net interest income	1,912			2,053			(141		)	(7	)	5,444			5,897			(453		)	(8	)
Investments portfolio net interest income:
Contractual net interest income	1,167			1,346			(179		)	(13	)	3,737			4,189			(452		)	(11	)
Amortization	(152		)	(108		)	(44		)	(41	)	(429		)	(187		)	(242		)	(129	)
Total investments portfolio net interest income	1,015			1,238			(223		)	(18	)	3,308			4,002			(694		)	(17	)
Hedge accounting impact	(517		)	(34		)	(483		)	(1,421	)	(262		)	(621		)	359			58
Net interest income		$2,410			$3,257			($847	)	(26	)%		$8,490			$9,278			($788	)	(8	)%

Key Drivers:

n Guarantee portfolio contractual net interest income

l 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Increased primarily due to the continued growth of the core single-family loan portfolio.

n Guarantee portfolio amortization

l 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Decreased primarily due to the timing differences in amortization related to prepayments between debt of consolidated trusts and the underlying mortgage loans. For further discussion on timing differences in amortization, see MD&A - Consolidated Results of Operations in our 2018 Annual Report.

n Investments portfolio contractual net interest income

l 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Decreased primarily due to the reduction in the balance of our mortgage-related investments portfolio pursuant to the portfolio limits established by the Purchase Agreement and FHFA. See Conservatorship and Related Matters - Managing Our Mortgage-Related Investments Portfolio for a discussion of the key drivers of the decline in our mortgage-related investments portfolio.

n Investments portfolio amortization

l YTD 2019 vs. YTD 2018 - Decreased primarily due to lower accretion income related to previously recognized other-than-temporary impairments as a result of a decline in the population of impaired securities.

n Hedge accounting impact

l 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Decreased in 3Q 2019 primarily due to amortization of previously deferred fair value hedge accounting losses and a negative earnings mismatch related to fair value hedge accounting. Increased in YTD 2019 primarily due to a positive earnings mismatch and lower expense related to accruals of periodic cash settlements on derivatives in hedging relationships, partially offset by amortization of hedge-related basis adjustments. The earnings mismatch is the amount by which the gain or loss on the designated derivative instrument does not exactly offset the gain or loss on the hedged item attributable to the hedged risk.

Freddie Mac Form 10-Q 7

Management's Discussion and Analysis Consolidated Results of Operations

Net Interest Yield Analysis

The tables below present an analysis of interest-earning assets and interest-bearing liabilities.

Table 3 - Analysis of Net Interest Yield

	3Q 2019								3Q 2018
(Dollars in millions)	Average Balance			Interest Income (Expense)(1)			Average Rate		Average Balance			Interest Income (Expense)(1)			Average Rate
Interest-earning assets:
Cash and cash equivalents		$10,313			$72		2.75	%		$7,114			$15		0.84	%
Securities purchased under agreements to resell	54,238			322			2.37		45,412			235			2.07
Secured lending	3,750			32			3.35		1,626			11			2.48
Mortgage-related securities	133,278			1,435			4.31		143,113			1,495			4.18
Extinguishment of debt securities of consolidated trusts held by Freddie Mac	(87,159		)	(883		)	(4.05	)	(89,976		)	(885		)	(3.93	)
Total mortgage-related securities, net	46,119			552			4.79		53,137			610			4.60
Non-mortgage-related securities	24,377			134			2.19		24,799			145			2.33
Loans held by consolidated trusts(1)	1,892,375			15,541			3.28		1,804,347			15,759			3.49
Loans held by Freddie Mac(1)	88,706			887			4.00		97,456			1,028			4.22
Total interest-earning assets	2,119,878			17,540			3.31		2,033,891			17,803			3.50
Interest-bearing liabilities:
Debt securities of consolidated trusts including those held by Freddie Mac	1,916,417			(14,207		)	(2.97	)	1,832,707			(13,712		)	(2.99	)
Extinguishment of debt securities of consolidated trusts held by Freddie Mac	(87,159		)	883			4.05		(89,976		)	885			3.93
Total debt securities of consolidated trusts held by third parties	1,829,258			(13,324		)	(2.91	)	1,742,731			(12,827		)	(2.94	)
Other debt:
Short-term debt	85,980			(499		)	(2.28	)	69,435			(361		)	(2.04	)
Long-term debt	195,530			(1,307		)	(2.65	)	212,256			(1,358		)	(2.54	)
Total other debt	281,510			(1,806		)	(2.54	)	281,691			(1,719		)	(2.42	)
Total interest-bearing liabilities	2,110,768			(15,130		)	(2.86	)	2,024,422			(14,546		)	(2.87	)
Impact of net non-interest-bearing funding	9,110			—			0.01		9,469			—			0.01
Total funding of interest-earning assets		$2,119,878			($15,130	)	(2.85	)%		$2,033,891			($14,546	)	(2.86	)%
Net interest income/yield					$2,410		0.46	%					$3,257		0.64	%

(1) Loan fees, primarily consisting of amortization of upfront fees, included in interest income were $922 million and $620 million for loans held by consolidated trusts and $49 million and $25 million for loans held by Freddie Mac during 3Q 2019 and 3Q 2018, respectively.

Freddie Mac Form 10-Q 8

Management's Discussion and Analysis Consolidated Results of Operations

	YTD 2019								YTD 2018
(Dollars in millions)	Average Balance			Interest Income (Expense)(1)			Average Rate		Average Balance			Interest Income (Expense)(1)			Average Rate
Interest-earning assets:
Cash and cash equivalents		$8,608			$156		2.40	%		$6,917			$39		0.74	%
Securities purchased under agreements to resell	52,398			968			2.46		46,743			637			1.82
Secured lending	2,547			72			3.73		1,340			26			2.58
Mortgage-related securities:
Mortgage-related securities	133,585			4,369			4.36		145,965			4,571			4.18
Extinguishment of debt securities of consolidated trusts held by Freddie Mac	(86,341		)	(2,687		)	(4.15	)	(89,861		)	(2,577		)	(3.82	)
Total mortgage-related securities, net	47,244			1,682			4.74		56,104			1,994			4.74
Non-mortgage-related securities	21,571			378			2.33		18,017			302			2.23
Loans held by consolidated trusts(1)	1,869,628			48,895			3.49		1,789,433			45,908			3.42
Loans held by Freddie Mac(1)	88,191			2,837			4.29		100,382			3,174			4.22
Total interest-earning assets	2,090,187			54,988			3.51		2,018,936			52,080			3.44
Interest-bearing liabilities:
Debt securities of consolidated trusts including those held by Freddie Mac	1,894,109			(43,688		)	(3.08	)	1,816,897			(40,573		)	(2.98	)
Extinguishment of debt securities of consolidated trusts held by Freddie Mac	(86,341		)	2,687			4.15		(89,861		)	2,577			3.82
Total debt securities of consolidated trusts held by third parties	1,807,768			(41,001		)	(3.02	)	1,727,036			(37,996		)	(2.93	)
Other debt:
Short-term debt	78,076			(1,419		)	(2.40	)	63,576			(832		)	(1.73	)
Long-term debt	197,826			(4,078		)	(2.74	)	220,820			(3,974		)	(2.39	)
Total other debt	275,902			(5,497		)	(2.64	)	284,396			(4,806		)	(2.24	)
Total interest-bearing liabilities	2,083,670			(46,498		)	(2.97	)	2,011,432			(42,802		)	(2.84	)
Impact of net non-interest-bearing funding	6,517			—			0.01		7,504			—			0.01
Total funding of interest-earning assets		$2,090,187			($46,498	)	(2.96	)%		$2,018,936			($42,802	)	(2.83	)%
Net interest income/yield					$8,490		0.55	%					$9,278		0.61	%

(1) Loan fees, primarily consisting of amortization of upfront fees, included in interest income were $2.2 billion and $1.8 billion for loans held by consolidated trusts and $88 million and $70 million for loans held by Freddie Mac during YTD 2019 and YTD 2018, respectively.

Guarantee Fee Income

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Increased due to the continued growth in the multifamily guarantee portfolio.

Freddie Mac Form 10-Q 9

Management's Discussion and Analysis Consolidated Results of Operations

Other Non-Interest Income (Loss)

Mortgage Loans Gains (Losses)

The table below presents the components of mortgage loans gains (losses).

Table 4 - Components of Mortgage Loans Gains (Losses)

						Change									Change
(Dollars in millions)	3Q 2019		3Q 2018			$		%		YTD 2019		YTD 2018			$		%
Gains (losses) on certain loan purchase commitments		$641	$267				$374	140	%		$1,644		$564			$1,080	191	%
Gains (losses) on mortgage loans	1,061		(173		)	1,234		713		2,530		(331		)	2,861		864
Mortgage loans gains (losses)		$1,702		$94			$1,608	1,711	%		$4,174		$233			$3,941	1,691	%

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Increased due to fair value gains on multifamily held-for-sale mortgage loans and commitments driven by decreasing long-term interest rates, coupled with higher gains on sales of single-family seasoned loans.

Investment Securities Gains (Losses)

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Shifted to gains in the 2019 periods from losses in the 2018 periods primarily due to gains on trading securities driven by decreasing long-term interest rates.

Debt Gains (Losses)

The table below presents the components of debt gains (losses).

Table 5 - Components of Debt Gains (Losses)

						Change										Change
(Dollars in millions)	3Q 2019			3Q 2018		$			%		YTD 2019			YTD 2018		$			%
Fair value changes		$51			$12		$39		325	%		$114			$42		$72		171	%
Gains (losses) on extinguishment of debt	(107		)	146		(253		)	(173	)	(106		)	403		(509		)	(126	)
Debt gains (losses)		($56	)		$158		($214	)	(135	)%		$8			$445		($437	)	(98	)%

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Decreased primarily due to losses from the extinguishment of fixed-rate debt securities of consolidated trusts, as long-term interest rates declined between the time of issuance and repurchase.

Derivative Gains (Losses)

The table below presents the components of derivative gains (losses).

Table 6 - Components of Derivative Gains (Losses)

							Change											Change
(Dollars in millions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Fair value change in interest-rate swaps		($1,809	)		$736			($2,545	)	(346	)%		($4,565	)		$2,833			($7,398	)	(261	)%
Fair value change in option-based derivatives	947			(306		)	1,253			409		1,408			(1,020		)	2,428			238
Fair value change in other derivatives	(308		)	271			(579		)	(214	)	(1,612		)	1,322			(2,934		)	(222	)
Accrual of periodic cash settlements	(47		)	27			(74		)	(274	)	(143		)	(161		)	18			11
Derivative gains (losses)		($1,217	)		$728			($1,945	)	(267	)%		($4,912	)		$2,974			($7,886	)	(265	)%

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Decreased as long-term interest rates declined. The decline in interest rates resulted in fair value losses on pay-fixed interest rate swaps, forward commitments to issue debt securities of consolidated trusts, and futures, which were partially offset by fair value gains on receive-fixed swaps and certain option-based derivatives. Additionally, our derivative volume increased beginning in 2Q 2019 as we updated our interest-rate risk

Freddie Mac Form 10-Q 10

Management's Discussion and Analysis Consolidated Results of Operations

measures to include upfront fees (including buy-downs) related to single-family credit guarantee activity. This update introduced additional volatility which resulted in increased losses, partially offset by the effects of hedge accounting.

Benefit (Provision) for Credit Losses

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Remained relatively flat due to the strong credit performance of both our single-family and multifamily portfolios.

Other Comprehensive Income (Loss)

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Shifted to gains in the 2019 periods from losses in the 2018 periods primarily due to fair value gains on available-for-sale securities as long-term interest rates declined.

Freddie Mac Form 10-Q 11

Management's Discussion and Analysis Consolidated Balance Sheets Analysis

CONSOLIDATED BALANCE SHEETS ANALYSIS

The table below compares our summarized consolidated balance sheets.

Table 7 - Summarized Consolidated Balance Sheets

					Change
(Dollars in millions)	9/30/2019		12/31/2018		$			%
Assets:
Cash and cash equivalents		$8,708		$7,273		$1,435		20	%
Securities purchased under agreements to resell	51,187		34,771		16,416			47
Subtotal	59,895		42,044		17,851			42
Investments in securities, at fair value	72,982		69,111		3,871			6
Mortgage loans, net	1,997,490		1,926,978		70,512			4
Accrued interest receivable	6,790		6,728		62			1
Derivative assets, net	1,592		335		1,257			375
Deferred tax assets, net	5,784		6,888		(1,104		)	(16	)
Other assets	25,713		10,976		14,737			134
Total assets		$2,170,246		$2,063,060		$107,186		5	%
Liabilities and Equity:
Liabilities:
Accrued interest payable		$6,688		$6,652		$36		1	%
Debt, net	2,149,259		2,044,950		104,309			5
Derivative liabilities, net	355		583		(228		)	(39	)
Other liabilities	7,270		6,398		872			14
Total liabilities	2,163,572		2,058,583		104,989			5
Total equity	6,674		4,477		2,197			49
Total liabilities and equity		$2,170,246		$2,063,060		$107,186		5	%

Key Drivers:

As of September 30, 2019 compared to December 31, 2018:

n Cash and cash equivalents and securities purchased under agreements to resell increased on a combined basis primarily due to higher near-term cash needs for upcoming debt maturities and anticipated calls of other debt.

n Other assets increased primarily due to higher servicer receivables driven by an increase in mortgage loan payoffs reported but not yet remitted at the end of 3Q 2019 and a change in our servicing cycle in 2Q 2019 related to the implementation of Release 2 of the CSP and the Single Security Initiative.

n Total equity increased primarily as a result of our ability to retain 3Q 2019 earnings as a result of an increase in the applicable Capital Reserve Amount from $3.0 billion to $20.0 billion pursuant to the September 2019 Letter Agreement.

Freddie Mac Form 10-Q 12

Management's Discussion and Analysis Our Business Segments | Segment Earnings

OUR BUSINESS SEGMENTS

We have three reportable segments, which are based on the way we manage our business.

n Single-Family Guarantee - Reflects results from our purchase, securitization, and guarantee of single-family loans and the management of single-family mortgage credit risk.

n Multifamily - Reflects results from our purchase, sale, securitization, and guarantee of multifamily loans and securities, our investments in those loans and securities, and the management of multifamily mortgage credit risk and market spread risk.

n Capital Markets - Reflects results from managing our mortgage-related investments portfolio (excluding Multifamily segment investments, single-family seriously delinquent loans, and the credit risk of single-family performing and reperforming loans), single-family securitization activities, and treasury function, which includes interest-rate risk management for the company.

Certain activities that are not part of a reportable segment, such as material corporate-level activities that are infrequent in nature and based on decisions outside the control of the management of our reportable segments, are included in the All Other category.

Segment Earnings

We present Segment Earnings by reclassifying certain credit guarantee-related activities and investment-related activities between various line items on our GAAP condensed consolidated statements of comprehensive income and allocating certain revenues and expenses to our three reportable segments. For more information on our segment reclassifications, see Note 13.

Segment Comprehensive IncomeThe graph below shows our comprehensive income by segment.

(In millions)

Freddie Mac Form 10-Q 13

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Single-Family Guarantee

Business Results

The following tables, graphs, and related discussion present the business results of our Single-family Guarantee segment.

New Business Activity

UPB of Single-Family Loan Purchases and Guarantees by Loan Purpose

(In billions)

Percentage of Single-Family Loan Purchases and Guarantees by Loan Purpose

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Our loan purchase and guarantee activity increased due to higher home purchase volume and increased refinance activity, driven by the declining average mortgage interest rates in recent quarters.

Freddie Mac Form 10-Q 14

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Single-Family Credit Guarantee Portfolio

Single-Family Credit Guarantee Portfolio

n The single-family credit guarantee portfolio increased at an annualized rate of approximately 5% between December 31, 2018 and September 30, 2019 driven by an increase in U.S. single-family mortgage debt outstanding as a result of continued home price appreciation and our overall share of the single-family mortgage market. New business acquisitions had a higher average loan size compared to older vintages that continued to run off.

n The core single-family loan portfolio grew to 84% of the single-family credit guarantee portfolio at September 30, 2019, compared to 82% at December 31, 2018.

n The legacy and relief refinance single-family loan portfolio declined to 16% of the single-family credit guarantee portfolio at September 30, 2019, compared to 18% at December 31, 2018.

Freddie Mac Form 10-Q 15

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Guarantee Fees

We receive fees for guaranteeing the payment of principal and interest to investors in our mortgage-related securities. These fees consist primarily of a combination of base contractual guarantee fees paid on a monthly basis and initial upfront payments. The average portfolio Segment Earnings guarantee fee rate recognizes upfront fee income over the contractual life of the related loans (usually 30 years). If the related loans prepay, the remaining upfront fee income is recognized immediately. In contrast, the average guarantee fee rate charged on new acquisitions recognizes upfront fee income over the estimated life of the related loans using our expectations of prepayments and other liquidations. See MD&A - Our Business Segments - Single-Family Guarantee - Business Overview - Guarantee Fees in our 2018 Annual Report for more information on our guarantee fees.

Average Portfolio Segment Earnings Guarantee Fee Rate⁽¹⁾⁽²⁾  

(In bps)

(1) Excludes the legislated 10 basis point increase in guarantee fees.

(2) Reflects an average rate for our total single-family credit guarantee portfolio and is not limited to purchases in the applicable period.

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - The average portfolio Segment Earnings guarantee fee rate increased due to an increase in the recognition of upfront fees primarily driven by a higher prepayment rate and an increase in average contractual guarantee fees caused by the run off of older vintages with lower contractual guarantee fees.

Freddie Mac Form 10-Q 16

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Average Guarantee Fee Rate⁽¹⁾ Charged on New Acquisitions

(In bps)

(1) Excludes the legislated 10 basis point increase in guarantee fees.

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - The average guarantee fee rate charged on new acquisitions increased primarily due to an enhancement in our estimation methodology related to recognition of buy-up fees in 2Q 2019.

Freddie Mac Form 10-Q 17

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

CRT Activities

We transfer credit risk on a portion of our single-family credit guarantee portfolio to the private market, which reduces the risk of future losses to us and taxpayers when borrowers go into default. See MD&A - Our Business Segments - Single-Family Guarantee - Business Overview - Products and Activities - Credit Risk Transfer (CRT) Transactions in our 2018 Annual Report for more information on our CRT transactions.

The following table presents the issuance amounts during 3Q 2019 on the protected UPB and maximum coverage by loss position associated with CRT transactions for loans in our single-family credit guarantee portfolio.

Table 8 - Single-Family Credit Guarantee Portfolio CRT Issuance

	Issuance for the Three Months Ended September 30, 2019
	Protected UPB(1)			Maximum Coverage(2)
(In millions)	Total			First Loss(3)		Mezzanine		Total
CRT Activities:
STACR Trust transactions		$56,654			$480		$1,186		$1,666
ACIS® transactions	45,917			108		404		512
Senior subordinate securitization structures	3,002			195		269		464
Other	9,305			243		279		522
Less: UPB with more than one type of CRT activity	(37,045		)	—		—		—
Total CRT Activities		$77,833			$1,026		$2,138		$3,164

(1) For STACR Trust and ACIS transactions, represents the UPB of the assets included in the reference pool. For senior subordinate securitization structure transactions, represents the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities.

(2) For STACR Trust transactions, represents the balance held by third parties at issuance. For ACIS transactions, represents the aggregate limit of insurance purchased from third parties at issuance. For senior subordinate securitization structure transactions, represents the UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties.

(3) First loss includes the most subordinate securities (i.e., B tranches) in our STACR Trust transactions and their equivalent in ACIS and Other CRT transactions.

We retained exposure to $74.7 billion of the protected UPB for the CRT issuances during 3Q 2019, including first loss and mezzanine positions.

We are continually evaluating our CRT strategy, and we make changes depending on market conditions and our business strategy. The aggregate cost of our CRT activity, as well as the amount of credit risk transferred, will continue to increase as we execute new transactions.

Freddie Mac Form 10-Q 18

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Credit Enhancements

To reduce our credit risk exposure, we engage in various credit enhancement arrangements, which include CRT transactions and other credit enhancements.

The tables below provide information on the total protected UPB and maximum coverage associated with credit enhanced loans in our single-family credit guarantee portfolio, measured by UPB, that were covered by one or more forms of credit enhancements as of September 30, 2019 and December 31, 2018, respectively. See MD&A - Risk Management - Single-Family Mortgage Credit Risk - Transferring Credit Risk of the Single-Family Credit Guarantee Portfolio to Investors in New and Innovative Ways in our 2018 Annual Report and Note 6 in this Form 10-Q and our 2018 Annual Report for additional information about our single-family credit enhancements.

Table 9 - Details of Credit Enhanced Loans in Our Single-Family Credit Guarantee Portfolio

	t	Outstanding as of September 30, 2019
		Protected UPB(1)			Percentage of Single-Family Credit Guarantee Portfolio		Maximum Coverage(2)
(In millions)		Total			Total		First Loss(3)		Mezzanine		Total
CRT Activities:
STACR debt notes			$554,572		28	%		$2,209		$13,753		$15,962
STACR Trust transactions		280,889			14		3,042		6,112		9,154
ACIS transactions		869,148			44		2,069		8,012		10,081
Senior subordinate securitization structures		43,552			2		2,331		2,587		4,918
Other		28,347			1		5,347		723		6,070
Less: UPB with more than one type of CRT activity		(780,820		)	(39	)	—		—		—
Total CRT Activities			$995,688		50	%		$14,998		$31,187		$46,185
Other Credit Enhancements:
Primary Mortgage Insurance			$410,999		21	%		$105,171	—			$105,171
Other		2,296			—		1,229		—		1,229
Less: UPB with both CRT and other credit enhancements		(287,231		)	(14	)	—		—		—
Single-family credit guarantee portfolio with credit enhancement		1,121,752			57		121,398		31,187		152,585
Single-family credit guarantee portfolio without credit enhancement		839,529			43		—		—		—
Total			$1,961,281		100	%		$121,398		$31,187		$152,585

Referenced footnotes are included after the next table.

Freddie Mac Form 10-Q 19

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

	Outstanding as of December 31, 2018
	Protected UPB(1)			Percentage of Single-Family Credit Guarantee Portfolio		Maximum Coverage(2)
(In millions)	Total			Total		First Loss(3)		Mezzanine		Total
CRT Activities:
STACR debt notes		$605,263		32	%		$2,155		$15,441		$17,596
STACR Trust transactions	161,152			8		1,622		3,404		5,026
ACIS transactions	807,885			43		1,552		7,571		9,123
Senior subordinate securitization structures	39,860			2		1,807		2,046		3,853
Other	18,136			1		5,049		340		5,389
Less: UPB with more than one type of CRT activity	(736,334		)	(39	)	—		—		—
Total CRT Activities		$895,962		47	%		$12,185		$28,802		$40,987
Other Credit Enhancements:
Primary Mortgage Insurance		$378,594		20	%		$96,996	—			$96,996
Other	2,642			—		1,341		—		1,341
Less: UPB with both CRT and other credit enhancements	(254,774		)	(13	)	—		—		—
Single-family credit guarantee portfolio with credit enhancement	1,022,424			54		110,522		28,802		139,324
Single-family credit guarantee portfolio without credit enhancement	873,762			46		—		—		—
Total		$1,896,186		100	%		$110,522		$28,802		$139,324

(1) For STACR and ACIS transactions, represents the UPB of the assets included in the reference pool. For senior subordinate securitization structure transactions, represents the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities.

(2) For STACR transactions, represents the outstanding balance held by third parties. For ACIS transactions, represents the remaining aggregate limit of insurance purchased from third parties. For senior subordinate securitization structure transactions, represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties.

(3) First loss includes the most subordinate securities (i.e., B tranches) in our STACR transactions and their equivalent in ACIS and Other CRT transactions.

n We had coverage remaining of $152.6 billion and $139.3 billion on our single-family credit guarantee portfolio as of September 30, 2019 and December 31, 2018, respectively. CRT transactions provided 30.3% and 29.4% of the coverage remaining at those dates.

n As of September 30, 2019, we had cumulatively transferred a portion of credit risk on nearly $1.4 trillion of our single-family mortgages, based upon the UPB at issuance of the CRT transactions.

l FHFA's conservatorship capital needed for credit risk was reduced by approximately 75% through CRT transactions on new business activity in the twelve months ended September 30, 2018.

l The reduction in the amount of conservatorship capital needed for credit risk on new business activity is calculated as conservatorship credit capital released from the CRT transactions (primarily through STACR and ACIS) divided by total conservatorship credit capital on new business activity at the time of purchase. For more information on the CCF and the calculation of conservatorship capital, see Liquidity and Capital Resources - Capital Resources - Conservatorship Capital Framework - Return on Conservatorship Capital.

n During YTD 2019, we paid $501 million in interest expense, net of reinvestment income, on our outstanding STACR debt notes and $507 million in premium expense for ACIS and STACR Trust contracts, compared to $540 million in interest expense, net of reinvestment income, on our outstanding STACR debt notes and $249 million in premium expense for ACIS and STACR Trust contracts during YTD 2018.

n As of September 30, 2019, we had experienced minimal write-downs on our STACR transactions and filed minimal claims for reimbursement of losses under our ACIS transactions.

Freddie Mac Form 10-Q 20

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Mortgage Loan Credit Risk

Certain combinations of loan attributes can indicate a higher degree of credit risk, such as loans with both higher LTV ratios and lower credit scores. The following table presents the combination of credit score and current LTV (CLTV) ratio attributes of loans in our single-family credit guarantee portfolio.

Table 10 - Single-Family Credit Guarantee Portfolio Attribute Combinations for Higher Risk Loans

	September 30, 2019
	CLTV ≤ 80				CLTV > 80 to 100				CLTV > 100				All Loans
(Credit score)	% Portfolio		SDQ Rate		% Portfolio		SDQ Rate(1)		% Portfolio		SDQ Rate(1)		% Portfolio		SDQ Rate		% Modified
Core single-family loan portfolio:
< 620	0.3	%	2.31	%	—	%	NM		—	%	NM		0.3	%	2.51	%	3.6	%
620 to 659	2.2		1.15		0.3		1.44		—		NM		2.5		1.18		2.0
≥ 660	69.5		0.18		12.0		0.25		—		NM		81.5		0.19		0.3
Not available	0.1		1.14		—		NM		—		NM		0.1		1.98		3.5
Total	72.1	%	0.23	%	12.3	%	0.31	%	—	%	NM		84.4	%	0.24	%	0.4	%
Legacy and relief refinance single-family loan portfolio:
< 620	1.0	%	3.88	%	0.2	%	8.47	%	0.1	%	14.84	%	1.3	%	4.56	%	19.2	%
620 to 659	1.5		2.87		0.2		7.23		0.1		12.14		1.8		3.38		17.4
≥ 660	11.2		1.02		0.9		3.63		0.3		6.10		12.4		1.20		6.3
Not available	0.1		4.38		—		NM		—		NM		0.1		4.66		19.7
Total	13.8	%	1.50	%	1.3	%	4.90	%	0.5	%	8.59	%	15.6	%	1.77	%	8.9	%

(1) NM - Not meaningful due to the percentage of the portfolio rounding to zero.

Alt-A and Subprime Loans

While we have referred to certain loans as subprime or Alt-A for purposes of the discussion below and elsewhere in this Form 10-Q, there is no universally accepted definition of subprime or Alt-A, and the classification of such loans may differ from company to company. We do not rely on these loan classifications to evaluate the credit risk exposure relating to such loans in our single-family credit guarantee portfolio.

Participants in the mortgage market have characterized single-family loans based upon their overall credit quality at the time of origination, including as prime or subprime. While we have not historically characterized the loans in our single-family credit guarantee portfolio as either prime or subprime, we monitor the amount of loans we have guaranteed with characteristics that indicate a higher degree of credit risk. In addition, we estimate that approximately $0.8 billion and $0.9 billion of security collateral underlying our other securitization products at September 30, 2019 and December 31, 2018, respectively, were identified as subprime based on information provided to us when we entered into these transactions.

Mortgage market participants have classified single-family loans as Alt-A if these loans have credit characteristics that range between the prime and subprime categories, if they are underwritten with lower or alternative income or asset documentation requirements compared to a full documentation loan, or both. Although we have discontinued new purchases of loans with lower documentation standards, we continue to purchase certain amounts of such loans in cases where the loan was either purchased pursuant to a previously issued guarantee, as part of our relief refinance initiative, or as part of another refinance loan initiative and the pre-existing loan was originated under less than full documentation standards. In the event we purchase a refinance loan and the original loan had been previously identified as Alt-A, such refinance loan may no longer be categorized or reported as an Alt-A loan in this Form 10-Q and our other financial reports because the new refinance loan replacing the original loan would not be identified by the seller/servicer as an Alt-A loan. As a result, our reported Alt-A balances may be lower than would otherwise be the case had such refinancing not occurred. From the time the relief refinance initiative began in 2009 to September 30, 2019, we have purchased approximately $36.4 billion of relief refinance loans that were previously categorized as Alt-A loans in our portfolio.

Freddie Mac Form 10-Q 21

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

The table below contains information on Alt-A loans in our single-family credit guarantee portfolio.

Table 11 - Alt-A Loans in Our Single-Family Credit Guarantee Portfolio

	September 30, 2019								December 31, 2018
(Dollars in billions)	UPB		CLTV		% Modified		SDQ Rate		UPB		CLTV		% Modified		SDQ Rate
Alt-A		$21.7	62	%	20.1	%	3.75	%		$23.9	63	%	23.2	%	4.13	%

The UPB of Alt-A loans in our single-family credit guarantee portfolio is continuing to decline due to borrowers refinancing into other mortgage products, foreclosure sales, and other liquidation events.

Single-Family Loan Performance

Serious Delinquency Rates

Percentage of Single-Family Loans One Month and Two Months Past Due     

n The total serious delinquency rate on our single-family credit guarantee portfolio was 0.61% as of September 30, 2019. However, 37% of the seriously delinquent loans at September 30, 2019 were covered by credit enhancements designed to reduce our credit risk exposure. See Note 4 for additional information on our single-family delinquency rates.

n Our total single-family serious delinquency rate was lower as of September 30, 2019 compared to September 30, 2018 due to our continued loss mitigation efforts, sales of certain seriously delinquent loans, home price appreciation, a low unemployment rate, and the reduced impacts from the hurricanes in the third quarter of 2017. This improvement was also driven by the continued shift in the single-family credit guarantee portfolio mix, as the legacy and relief refinance single-family loan portfolio runs off and we add higher credit quality loans to our core single-family loan portfolio.

n The percentage of single-family loans one month past due can be volatile due to servicer reporting methodologies, seasonality, and other factors that may not be predictive of default. As a result, the percentage of loans two months past due tends to be a better early performance indicator than the percentage of loans one month past due. The percentage of loans two months past due was relatively flat from September 30, 2018 to September 30, 2019.

Freddie Mac Form 10-Q 22

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Credit Performance

The table below contains certain credit performance metrics for our single-family credit guarantee portfolio.

Table 12 - Single-Family Credit Guarantee Portfolio Credit Performance Metrics

(Dollars in millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Charge-offs, gross		$407			$1,277			$1,256			$2,248
Recoveries	(107		)	(119		)	(341		)	(341		)
Charge-offs, net	300			1,158			915			1,907
REO operations expense	58			38			172			87
Total credit losses		$358			$1,196			$1,087			$1,994
Total credit losses (in bps)	7.3			25.4			7.4			14.2

The table below summarizes the carrying value for individually impaired single-family loans on our condensed consolidated balance sheets for which we have recorded an allowance determined on an individual basis.

Table 13 - Single-Family Individually Impaired Loans with an Allowance Recorded

	September 30, 2019					September 30, 2018
(Dollars in millions)	Loan Count		Amount			Loan Count		Amount
TDRs, at January 1	290,255			$42,254		364,704			$54,415
New additions	23,420		3,696			45,348		7,066
Repayments and reclassifications to held-for-sale	(52,970	)	(8,897		)	(92,662	)	(14,875		)
Foreclosure sales and foreclosure alternatives	(3,673	)	(496		)	(5,907	)	(796		)
TDRs, at September 30	257,032		36,557			311,483		45,810
Loans impaired upon purchase	1,909		122			2,814		188
Total impaired loans with an allowance recorded	258,941		36,679			314,297		45,998
Allowance for loan losses			(3,326		)			(5,137		)
Net investment, at September 30				$33,353					$40,861

The tables below present information about the UPB of single-family TDRs and non-accrual loans on our condensed consolidated balance sheets.

Table 14 - Single-Family TDR and Non-Accrual Loans

(In millions)	September 30, 2019		December 31, 2018
TDRs on accrual status		$36,845		$41,839
Non-accrual loans	10,131		11,197
Total TDRs and non-accrual loans		$46,976		$53,036
Allowance for loan losses associated with:
TDRs on accrual status		$2,847		$3,612
Non-accrual loans	662		1,003
Total		$3,509		$4,615
(In millions)	YTD 2019		YTD 2018
Foregone interest income on TDRs and non-accrual loans(1)		$680		$965

(1) Represents the amount of interest income that we did not recognize but would have recognized during the period for loans outstanding at the end of each period, had the loans performed according to their original contractual terms.

n As of September 30, 2019, 43% of the allowance for loan losses for single-family mortgage loans related to interest rate concessions provided to borrowers as part of loan modifications.

n Most of our modified single-family loans, including TDRs, were current and performing at September 30, 2019.

n We expect our allowance for loan losses associated with existing single-family TDRs to decline over time as we continue to sell reperforming loans. In addition, the allowance for loan losses will decline as borrowers continue to make monthly payments under the modified terms and interest rate concessions are amortized into earnings.

n See Note 4 for information on our single-family allowance for loan losses.

Freddie Mac Form 10-Q 23

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Loss Mitigation Activities

Loan Workout Activity

(UPB in billions, number of loan workouts in thousands)

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Our loan workout activity decreased driven by the reduced impact from the hurricanes in the third quarter of 2017.

n We continue our loss mitigation efforts through our relief refinance, modification, and other initiatives.

REO Activity

The table below presents a summary of our single-family REO activity.

Table 15 - Single-Family REO Activity

	3Q 2019					3Q 2018					YTD 2019					YTD 2018
(Dollars in millions)	Number of Properties		Amount			Number of Properties		Amount			Number of Properties		Amount			Number of Properties		Amount
Beginning balance — REO	5,869			$666		7,135			$777		7,100			$780		8,299			$900
Additions	2,004		203			2,506		247			6,143		605			7,870		759
Dispositions	(2,470	)	(254		)	(2,622	)	(256		)	(7,840	)	(770		)	(9,150	)	(891		)
Ending balance — REO	5,403		615			7,019		768			5,403		615			7,019		768
Beginning balance, valuation allowance			(6		)			(6		)			(11		)			(14		)
Change in valuation allowance			(2		)			(2		)			3					6
Ending balance, valuation allowance			(8		)			(8		)			(8		)			(8		)
Ending balance — REO, net				$607					$760					$607					$760

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Our REO ending inventory declined primarily due to a decrease in REO acquisitions driven by fewer loans in foreclosure and a large proportion of property sales to third parties at foreclosure.

Freddie Mac Form 10-Q 24

Management's Discussion and Analysis Our Business Segments | Single-Family Guarantee

Financial Results

The table below presents the components of Segment Earnings and comprehensive income for our Single-family Guarantee segment.

Table 16 - Single-Family Guarantee Segment Financial Results

							Change											Change
(Dollars in millions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Guarantee fee income		$2,075			$1,676			$399		24	%		$5,597			$4,932			$665		13	%
Benefit (provision) for credit losses	134			205			(71		)	(35	)	221			366			(145		)	(40	)
Financial instrument gains (losses)(1)	51			(5		)	56			1,120		66			43			23			53
Other non-interest income (loss)	318			387			(69		)	(18	)	836			592			244			41
Administrative expense	(399		)	(371		)	(28		)	(8	)	(1,173		)	(1,070		)	(103		)	(10	)
REO operations income (expense)	(61		)	(42		)	(19		)	(45	)	(185		)	(101		)	(84		)	(83	)
Other non-interest expense	(554		)	(413		)	(141		)	(34	)	(1,667		)	(1,192		)	(475		)	(40	)
Segment Earnings before income tax expense	1,564			1,437			127			9		3,695			3,570			125			4
Income tax (expense) benefit	(314		)	(254		)	(60		)	(24	)	(750		)	(686		)	(64		)	(9	)
Segment Earnings, net of taxes	1,250			1,183			67			6		2,945			2,884			61			2
Total other comprehensive income (loss), net of tax	(3		)	(2		)	(1		)	(50	)	(9		)	(8		)	(1		)	(13	)
Total comprehensive income (loss)		$1,247			$1,181			$66		6	%		$2,936			$2,876			$60		2	%

(1) Consists of fair value gains and losses on debt for which we have elected the fair value option and derivatives.

Key Business Drivers:

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018

l Higher guarantee fee income due to increased upfront fee amortization income driven by higher prepayments and continued growth in our single-family credit guarantee portfolio.

l Higher other non-interest income during YTD 2019 compared to YTD 2018 primarily due to higher gains on sales of single-family held-for-sale loans. Other non-interest income remained relatively flat during 3Q 2019 compared to 3Q 2018.

l Higher other non-interest expense primarily due to higher outstanding cumulative volumes of CRT transactions that resulted in increased CRT expense (interest expense on STACR debt notes and premium expense for ACIS and STACR Trust contracts).

Freddie Mac Form 10-Q 25

Management's Discussion and Analysis Our Business Segments | Multifamily

Multifamily

Business Results

The graphs, tables, and related discussion below present the business results of our Multifamily segment.

New Business Activity

Multifamily New Business Activity

(UPB in billions)

n The 2019 Conservatorship Scorecard annual production cap remained at $35.0 billion through the end of 3Q 2019. On September 13, 2019, FHFA announced a revised loan purchase cap structure for the multifamily business. The loan purchase cap will be $100.0 billion for the five-quarter period from the fourth quarter of 2019 through the fourth quarter of 2020. The new cap applies to all multifamily business, with no exclusions. To ensure a strong focus on affordable housing and traditionally underserved markets, FHFA directed that at least 37.5% of the new multifamily business be mission-driven, affordable housing. Loans that finance energy or water efficiency will be considered conventional business (i.e., they will not count towards the 37.5% requirement), unless they meet other mission-driven requirements.

n Outstanding commitments, including index lock commitments and commitments to purchase or guarantee multifamily assets, were $16.3 billion and $24.3 billion as of September 30, 2019 and September 30, 2018, respectively. Both period-end balances include loan purchase commitments for which we have elected the fair value option.

n The combination of our new business activity and outstanding commitments was higher during 3Q 2019 and YTD 2019 compared to 3Q 2018 and YTD 2018 due to continued strong demand for multifamily financing and healthy multifamily market fundamentals resulting in continued growth in overall multifamily mortgage debt outstanding. While our new

Freddie Mac Form 10-Q 26

Management's Discussion and Analysis Our Business Segments | Multifamily

business activity was higher during 3Q 2019 and YTD 2019, we expect new business activity for full-year 2019 to be similar to full-year 2018.

n Excluding our LIHTC new business activity, approximately 36% and 40% of our new business activity in 3Q 2019 and YTD 2019, respectively, counted towards the 2019 Conservatorship Scorecard production cap, while the remaining 64% and 60% was considered uncapped.

n The portion of our new loan purchase activity that was classified as held-for-sale and intended for our securitization pipeline decreased from 95% in 3Q 2018 to 84% in 3Q 2019 due to an increase in the issuance of other risk transfer securitizations, specifically our PC executions collateralized by held-for-investment loans. The purchase activity in 3Q 2019, combined with market demand for our securities, will be a driver for securitizations during the fourth quarter of 2019 and the first quarter of 2020.

Multifamily Portfolio and Market Support

Multifamily Market Support

The following table summarizes our support of the multifamily market.

Table 17 - Multifamily Market Support

(In millions)	September 30, 2019			December 31, 2018
Guarantee portfolio		$259,630			$237,323
Mortgage-related investments portfolio:
Unsecuritized mortgage loans held-for-sale	25,397			23,959
Unsecuritized mortgage loans held-for-investment	11,291			10,828
Mortgage-related securities(1)	5,663			7,385
Total mortgage-related investments portfolio	42,351			42,172
Other investments(2)	2,564			708
Total multifamily portfolio	304,545			280,203
Add: Unguaranteed securities(3)	38,980			35,835
Less: Acquired mortgage-related securities(4)	(5,478		)	(7,160		)
Total multifamily market support		$338,047			$308,878

(1) Includes mortgage-related securities acquired by us from our securitizations.

(2) Includes the carrying value of LIHTC investments and the UPB of non-mortgage loans, including financing provided to whole loan funds.

(3) Reflects the UPB of unguaranteed securities issued as part of our securitizations and amounts related to loans sold to whole loan funds that were not financed by Freddie Mac.

(4) Reflects the UPB of mortgage-related securities that were both issued as part of our securitizations and acquired by us. This UPB must be removed to avoid double-counting the exposure, as it is already reflected within the guarantee portfolio or unguaranteed securities.

n Our total multifamily portfolio increased during YTD 2019, primarily due to our strong loan purchase and securitization activity. We expect continued growth in our total portfolio as purchase and securitization activities should outpace run off.

n At September 30, 2019, approximately 77% of our held-for-sale loans and held-for-sale loan commitments were fixed-rate, while the remaining 23% were floating-rate.

Freddie Mac Form 10-Q 27

Management's Discussion and Analysis Our Business Segments | Multifamily

Net Interest Yield

Net Interest Yield Earned & Average Investment Portfolio Balance

(Weighted average balance in billions)

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018

l Net interest yield increased during 3Q 2019 due to lower funding costs on our held-for-sale mortgage loans driven by lower interest rates, coupled with a higher yield on interest-only securities. Net interest yield remained relatively flat during YTD 2019 compared to YTD 2018.

l The weighted average portfolio balance of interest-earning assets decreased during 3Q 2019 and YTD 2019 due to the run-off of our held-for-investment loans, partially offset by an increase in held-for-sale loans.

Freddie Mac Form 10-Q 28

Management's Discussion and Analysis Our Business Segments | Multifamily

K Certificate Benchmark Spreads

K Certificate Benchmark Spreads

n The valuation of our securitization pipeline and the profitability of our primary risk transfer securitization product, the K Certificate, are affected by both changes in K Certificate benchmark spreads and deal-specific attributes, such as tranche size, risk distribution, and collateral characteristics (loan term, coupon type, prepayment restrictions, and underlying property type). These market spread movements and deal-specific attributes contribute to our earnings volatility, which we manage by controlling the size of our securitization pipeline and by entering into certain spread-related derivatives. Spread tightening generally results in fair value gains, while spread widening generally results in fair value losses.

n K Certificate benchmark spreads generally widened during 3Q 2019 and 3Q 2018, primarily resulting in fair value losses on our held-for-sale mortgage loans and commitments.

Freddie Mac Form 10-Q 29

Management's Discussion and Analysis Our Business Segments | Multifamily

Risk Transfer Activity

UPB of Assets Subject to Risk Transfer Activity

(UPB in billions)

Freddie Mac Form 10-Q 30

Management's Discussion and Analysis Our Business Segments | Multifamily

Credit Risk Transfer Activity⁽¹⁾  

(UPB in billions)

(1) The amounts disclosed in the graph above represent the net credit risk transferred to third parties.

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - The UPB of our primary risk transfer securitization transactions increased due to a higher average balance in our securitization pipeline, which was driven by strong new loan purchase activity during the first half of 2019.

n As of September 30, 2019, we had cumulatively transferred a large majority of credit risk on the multifamily guarantee portfolio.

l Conservatorship capital needed for credit risk was reduced by approximately 90% through CRT transactions on new business activity in the twelve months ended September 30, 2018; we plan similar risk reduction transactions for this year's new business activity.

l The reduction in the amount of conservatorship capital needed for credit risk on new business activity is calculated as conservatorship credit capital released from CRT transactions (primarily through K Certificates and SB Certificates) divided by total conservatorship credit capital on new business activity. For more information on the CCF and the calculation of conservatorship capital, see Liquidity and Capital Resources - Capital Resources - Conservatorship Capital Framework - Return on Conservatorship Capital.

n In addition to transferring a large majority of credit risk, nearly all of our risk transfer securitization activities also shifted substantially all of the interest-rate and liquidity risk associated with the underlying collateral away from Freddie Mac to third-party investors.

Freddie Mac Form 10-Q 31

Management's Discussion and Analysis Our Business Segments | Multifamily

Guarantee Activities

New Guarantee Activity

(In billions)

Remaining Unearned Guarantee Fees

(In billions)

n We earn guarantee fees in exchange for providing our guarantee of some or all of the securities we issue as part of our risk transfer securitization activities. Each time we enter into a financial guarantee contract, we initially recognize an unearned guarantee fee asset on our balance sheet, which represents the present value of future guarantee fees we expect to receive in cash. We recognize these fees in Segment Earnings over the remaining average guarantee term, which was eight years as of September 30, 2019. While we expect to collect these future fees based on historical performance, the actual amount collected will depend on the credit and prepayment performance of the underlying collateral subject to our financial guarantee.

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - New unearned guarantee fee assets increased primarily due to an increase in guaranteed UPB issued by our securitizations.

n The balance of unearned guarantee fees increased during YTD 2019 due to the continued growth of our multifamily guarantee business, as our risk transfer securitization volume continued to be strong, outpacing run off.

Freddie Mac Form 10-Q 32

Management's Discussion and Analysis Our Business Segments | Multifamily

Financial Results

The table below presents the components of Segment Earnings and comprehensive income for our Multifamily segment.

Table 18 - Multifamily Segment Financial Results

							Change											Change
(Dollars in millions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Net interest income		$292			$280			$12		4	%		$805			$846			($41	)	(5	)%
Guarantee fee income	233			210			23			11		671			609			62			10
Benefit (provision) for credit losses	(1		)	2			(3		)	(150	)	(3		)	20			(23		)	(115	)
Financial instrument gains (losses)(1)	256			266			(10		)	(4	)	254			690			(436		)	(63	)
Administrative expense	(125		)	(109		)	(16		)	(15	)	(357		)	(315		)	(42		)	(13	)
Other non-interest income (expense)	72			13			59			454		254			96			158			165
Segment Earnings before income tax expense	727			662			65			10		1,624			1,946			(322		)	(17	)
Income tax (expense) benefit	(146		)	(113		)	(33		)	(29	)	(330		)	(374		)	44			12
Segment Earnings, net of taxes	581			549			32			6		1,294			1,572			(278		)	(18	)
Total other comprehensive income (loss), net of tax	10			(44		)	54			123		132			(136		)	268			197
Total comprehensive income (loss)		$591			$505			$86		17	%		$1,426			$1,436			($10	)	(1	)%

(1) Primarily consists of fair value gains and losses on loan purchase commitments, mortgage loans and debt for which we have elected the fair value option, certain investment securities, and derivatives.

Key Business Drivers:

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018

l Net interest income remained relatively flat.

l Increase in guarantee fee income driven by continued growth in our multifamily guarantee portfolio.

l Increase in fair value gains during 3Q 2019, primarily driven by fair value gains on held-for-sale commitments due to targeted price increases related to changing market conditions. During YTD 2019, fair value gains decreased primarily driven by spread-related fair value losses due to spread widening on certain available-for-sale securities (which are recorded in other comprehensive income), partially offset by fair value gains on held-for-sale commitments due to targeted price increases related to changing market conditions.

l Increase in other non-interest income primarily driven by lower losses on the fair value of the recognized unearned guarantee fee assets in the 2019 periods due to declining interest rates.

Freddie Mac Form 10-Q 33

Management's Discussion and Analysis Our Business Segments | Capital Markets

Capital Markets

Business Results

The graphs and related discussion below present the business results of our Capital Markets segment.

Investing Activity

The following graphs present the Capital Markets segment's total investments portfolio and the composition of its mortgage investments portfolio by liquidity category.

Investments Portfolio

Mortgage Investments Portfolio

n The balance of our mortgage investments portfolio remained relatively flat from December 31, 2018 to September 30, 2019. See Conservatorship and Related Matters - Managing Our Mortgage-Related Investments Portfolio for additional details.

n The balance of our other investments portfolio increased by 39.9%, primarily due to higher near-term cash needs as of September 30, 2019 compared to December 31, 2018 for upcoming debt maturities and anticipated calls of other debt.

n The overall liquidity of our mortgage investments portfolio continued to improve as our less liquid assets decreased during 3Q 2019. The percentage of less liquid assets relative to our total mortgage investments portfolio declined from 26.6% at December 31, 2018 to 20.0% at September 30, 2019, primarily due to repayments, sales, and securitizations. We continued to actively reduce our holdings of less liquid assets during 3Q 2019 by selling $3.5 billion of reperforming loans. Our sales of reperforming loans involved securitization of the loans using senior subordinate securitization structures.

n We continue to participate in transactions that support the development of SOFR as an alternative rate to LIBOR. These transactions include investment in and issuance of SOFR indexed floating-rate debt securities and execution of SOFR indexed derivatives.

Freddie Mac Form 10-Q 34

Management's Discussion and Analysis Our Business Segments | Capital Markets

Net Interest Yield and Average Balances

Net Interest Yield & Average Investments Portfolio Balances

(Weighted average balance in billions)

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018 - Net interest yield decreased 51 and 17 basis points during 3Q 2019 compared to 3Q 2018 and YTD 2019 compared to YTD 2018, respectively, primarily due to an increase in amortization expense resulting from higher loan liquidation rates, coupled with an increase in the percentage of our other investments portfolio relative to our total investments portfolio and the flattening of the yield curve.

n Net interest yield for the Capital Markets segment is not affected by our hedge accounting programs, due to reclassifications made for Segment Earnings. See Note 13 in our 2018 Annual Report for more information.

Freddie Mac Form 10-Q 35

Management's Discussion and Analysis Our Business Segments | Capital Markets

Financial Results

The table below presents the components of Segment Earnings and comprehensive income for our Capital Markets segment.

Table 19 - Capital Markets Segment Financial Results

							Change											Change
(Dollars in millions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Net interest income		$497			$845			($348	)	(41	)%		$2,002			$2,410			($408	)	(17	)%
Investment securities gains (losses)	136			(336		)	472			140		698			(524		)	1,222			233
Debt gains (losses)	(17		)	137			(154		)	(112	)	(27		)	368			(395		)	(107	)
Derivative gains (losses)	(438		)	427			(865		)	(203	)	(2,095		)	2,038			(4,133		)	(203	)
Other non-interest income (expense)	(237		)	179			(416		)	(232	)	189			535			(346		)	(65	)
Administrative expense	(96		)	(89		)	(7		)	(8	)	(287		)	(262		)	(25		)	(10	)
Segment Earnings before income tax expense	(155		)	1,163			(1,318		)	(113	)	480			4,565			(4,085		)	(89	)
Income tax (expense) benefit	33			(189		)	222			117		(97		)	(886		)	789			89
Segment Earnings, net of taxes	(122		)	974			(1,096		)	(113	)	383			3,679			(3,296		)	(90	)
Total other comprehensive income (loss), net of tax	132			(101		)	233			231		594			(847		)	1,441			170
Total comprehensive income (loss)		$10			$873			($863	)	(99	)%		$977			$2,832			($1,855	)	(66	)%

The portion of total comprehensive income (loss) driven by interest rate-related and market spread-related fair value changes, after-tax, is presented in the table below. These amounts affect various line items in the table above, including net interest income, investment securities gains (losses), debt gains (losses), derivative gains (losses), income tax (expense) benefit, and total other comprehensive income (loss), net of tax.

Table 20 - Capital Markets Segment Interest Rate-Related and Market Spread-Related Fair Value Changes, Net of Tax

							Change											Change
(Dollars in billions)	3Q 2019			3Q 2018			$			%		YTD 2019			YTD 2018			$			%
Interest rate-related		($0.4	)		($0.1	)		($0.3	)	(300	)%		($0.4	)		($0.1	)		($0.3	)	(300	)%
Market spread-related	0.2			0.1			0.1			100	%	0.3			0.3			—			—

Key Business Drivers:

n 3Q 2019 vs. 3Q 2018 and YTD 2019 vs. YTD 2018

l Net interest income decreased primarily due to an increase in amortization expense resulting from higher loan liquidation rates, coupled with a change in our investment mix as the other investments portfolio represents a larger percentage of our total investments portfolio and a flattening of the yield curve.

l Increase in interest rate-related fair value losses as long-term interest rates decreased during the 2019 periods, resulting in fair value gains on many of our investments in securities (some of which are recorded in other comprehensive income) and fair value losses on derivatives. The net amount of these changes in fair value was mostly offset by the change in the fair value of the hedged items attributable to interest-rate risk in our hedge accounting programs. Additionally, our derivative volume, which economically hedges certain financial instruments not recorded at fair value, increased beginning in 2Q 2019 as we updated our interest-rate risk measures to include upfront fees (including buy-downs) related to single-family credit guarantee activity recorded in the single-family segment. This update introduced additional volatility which resulted in increased losses, partially offset by the effects of hedge accounting.

l Decrease in debt gains (losses) primarily due to losses from the extinguishment of fixed-rate debt securities of consolidated trusts, as long-term interest rates declined between the time of issuance and repurchase.

l Decrease in non-interest income primarily due to lower net amortization income driven by the timing differences in amortization related to prepayment between debt of consolidated trusts and the underlying mortgage loans, combined with the effects of an earnings mismatch related to fair value hedge accounting. For further discussion on timing differences in amortization, see MD&A - Consolidated Results of Operations in our 2018 Annual Report.

Freddie Mac Form 10-Q 36

Management's Discussion and Analysis Risk Management

RISK MANAGEMENT

Risk is an inherent part of our business activities. We are exposed to the following key types of risk: credit risk, operational risk, market risk, liquidity risk, strategic risk, and reputation risk.

For more discussion of these and other risks facing our business and our enterprise risk framework, see MD&A - Risk Management in our 2018 Annual Report, Risk Factors in our 2018 Annual Report and our Form 10-Q for the quarter ended June 30, 2019, and Liquidity and Capital Resources in this Form 10-Q and our 2018 Annual Report. See below for updates since our Form 10-Q for the quarter ended June 30, 2019.

Market Risk

Overview

Our business segments have embedded exposure to market risk, which is the economic risk associated with adverse changes in interest rates, volatility, and spreads. Interest-rate risk is consolidated and primarily managed by the Capital Markets segment, while spread risk is owned by each individual business segment. Market risk can adversely affect future cash flows, or economic value, as well as earnings and net worth.

The majority of our interest-rate risk comes from our investments in mortgage-related assets (securities and loans), the debt we issue to fund our assets, and upfront fees (including buy-downs) related to our single-family credit guarantee activity. Our primary goal in managing interest-rate risk is to reduce the amount of change in the value of our future cash flows due to future changes in interest rates. We use models to analyze possible future interest-rate scenarios, along with the cash flows of our assets and liabilities over those scenarios.

Interest-Rate Risk

Our primary interest-rate risk measures are duration gap and Portfolio Value Sensitivity (PVS). Duration gap measures the difference in price sensitivity to interest rate changes between our financial assets and liabilities and is expressed in months relative to the value of assets. PVS is our estimate of the change in the value of our financial assets and liabilities from an instantaneous shock to interest rates, assuming spreads are held constant and no rebalancing actions are undertaken. PVS is measured in two ways, one measuring the estimated sensitivity of our portfolio value to a 50 basis point parallel movement in interest rates (PVS-L) and the other to a non-parallel movement resulting from a 25 basis point change in slope of the LIBOR yield curve (PVS-YC). While we believe that duration gap and PVS are useful risk management tools, they should be understood as estimates rather than as precise measurements.

The following tables provide our duration gap, estimated point-in-time and minimum and maximum PVS-L and PVS-YC results, and an average of the daily values and standard deviation. The tables below also provide PVS-L estimates assuming an immediate 100 basis point shift in the LIBOR yield curve. The interest-rate sensitivity of a mortgage portfolio varies across a wide range of interest rates.

We began to include upfront fees (including buy-downs) in our interest-rate metrics in 2Q 2019. Including upfront fees and related derivative activities significantly increased the Derivatives PVS-L and PVS-YC results for September 30, 2019 in the table below, with an offsetting impact in the Guarantees PVS-L and PVS-YC results.

Table 21 - PVS-YC and PVS-L Results Assuming Shifts of the LIBOR Yield Curve

	September 30, 2019									December 31, 2018
	PVS-YC			PVS-L						PVS-YC			PVS-L
(In millions)	25 bps			50 bps			100 bps			25 bps			50 bps			100 bps
Assuming shifts of the LIBOR yield curve, (gains) losses on:(1)
Assets:
Investments		($248	)		$4,523			$9,314			($536	)		$5,792			$11,761
Guarantees(2)	(253		)	451			943			89			(425		)	(773		)
Total Assets	(501		)	4,974			10,257			(447		)	5,367			10,988
Liabilities	23			(1,492		)	(3,126		)	(109		)	(1,889		)	(3,948		)
Derivatives	491			(3,392		)	(6,893		)	560			(3,446		)	(6,917		)
Total		$13			$90			$238			$4			$32			$123
PVS		$13			$90			$238			$4			$32			$123

Freddie Mac Form 10-Q 37

Management's Discussion and Analysis Risk Management 

(1) The categorization of the PVS impact between assets, liabilities, and derivatives on this table is based upon the economic characteristics of those assets and liabilities, not their accounting classification. For example, purchase and sale commitments of mortgage-related securities and debt securities of consolidated trusts held by the mortgage-related investments portfolio are both categorized as assets on this table.

(2) Represents the interest-rate risk from our single-family guarantee portfolio, which includes buy-ups, float, and, beginning in 2Q 2019, upfront fees (including buy-downs).

Table 22 - Duration Gap and PVS Results

	3Q 2019						3Q 2018
(Duration gap in months, dollars in millions)	Duration Gap		PVS-YC 25 bps		PVS-L 50 bps		Duration Gap		PVS-YC 25 bps		PVS-L 50 bps
Average	0.5			$17		$54	—			$12		$18
Minimum	(0.3	)	—		—		(0.2	)	—		—
Maximum	1.2		48		130		0.3		21		49
Standard deviation	0.2		12		29		0.1		5		15
	YTD 2019						YTD 2018
(Duration gap in months, dollars in millions)	Duration Gap		PVS-YC 25 bps		PVS-L 50 bps		Duration Gap		PVS-YC 25 bps		PVS-L 50 bps
Average	0.9			$43		$116	—			$11		$17
Minimum	(0.8	)	—		—		(0.4	)	—		—
Maximum	8.6		345		950		0.3		31		77
Standard deviation	1.8		81		213		0.1		6		17

Derivatives enable us to reduce our economic interest-rate risk exposure as we continue to align our derivative portfolio with the changing duration of our economically hedged assets and liabilities. The table below shows that the PVS-L risk levels, assuming a 50 basis point shift in the LIBOR yield curve for the periods presented, would have been higher if we had not used derivatives.

Table 23 - PVS-L Results Before Derivatives and After Derivatives

	PVS-L (50 bps)
(In millions)	Before Derivatives		After Derivatives		Effect of Derivatives
September 30, 2019		$3,482		$90		($3,392	)
December 31, 2018	3,478		32		(3,446		)

In April 2019, we updated our interest-rate risk measures and began incorporating upfront fees (including buy-downs) related to single-family credit guarantee activity into our asset and liability interest-rate risk management strategy and definition. As a result, the PVS-L before derivatives is significantly higher as of September 30, 2019 than it would have been if we had not updated our interest-rate risk management strategy and definition to include upfront fees.

The inclusion of upfront fees increased the volume of derivatives we used to hedge interest-rate risk, and this higher volume of derivatives, coupled with the volatility of market interest rates during the period, created variability in our PVS-L during 3Q 2019. The table below shows the average, minimum, and maximum PVS-L before derivatives and after derivatives during 3Q 2019.

Table 24 - PVS-L Average, Minimum, and Maximum

	3Q 2019
	PVS-L (50bps)
(In millions)	Before Derivatives		After Derivatives
Average		$3,883		$54
Minimum	3,477		—
Maximum	4,343		130

Freddie Mac Form 10-Q 38

Management's Discussion and Analysis Risk Management 

GAAP Earnings Variability

The GAAP accounting treatment for our financial assets and liabilities (i.e., some are measured at amortized cost, while others are measured at fair value) creates variability in our GAAP earnings when interest rates and spreads change. This variability of GAAP earnings, which may not reflect the economics of our business, increases the risk of our having a negative net worth and thus being required to draw from Treasury. Although we manage our business on an economic basis, we may execute certain transactions on a non-economic basis in an effort to manage our spread and interest-rate risks.

Interest-Rate Volatility

While we manage our interest-rate risk exposure on an economic basis to a low level as measured by our models, our GAAP financial results are still subject to significant earnings variability from period to period. Based upon the composition of our financial assets and liabilities, including derivatives, at September 30, 2019, we generally recognize fair value losses in GAAP earnings when interest rates decline.

In an effort to reduce our GAAP earnings variability and better align our GAAP results with the economics of our business, we elect hedge accounting for certain single-family mortgage loans and certain debt instruments. Beginning in September 2019, we implemented a new fair value hedge accounting strategy using single-family mortgage loans that applies certain hedge accounting elections allowable under amended hedge accounting guidance we adopted during 4Q 2017. See Note 9 for additional information on hedge accounting.

GAAP Adverse Scenario

We evaluate the potential benefits of fair value hedge accounting by evaluating a range of interest rate scenarios and identifying which of those scenarios produces the most adverse GAAP earnings outcome. The interest rate scenarios evaluated include parallel shifts in the yield curve of plus and minus 100 basis points, non-parallel yield curve shifts in which long-term interest rates increase or decrease by 100 basis points, and non-parallel yield curve shifts in which short-term and medium-term interest rates increase or decrease by 100 basis points.

n At September 30, 2019, the GAAP adverse scenario before fair value hedge accounting was a parallel shift in which rates decrease by 100 basis points, while the adverse scenario after fair value hedge accounting was a non-parallel shift in which long-term rates decrease by 100 basis points.

n At September 30, 2018, the GAAP adverse scenario before and after fair value hedge accounting was a non-parallel shift in which long-term rates decrease by 100 basis points.

The results of this evaluation are shown in the table below.

Table 25 - GAAP Adverse Scenario Before and After Hedge Accounting

	GAAP Adverse Scenario (Before-Tax)
(Dollars in billions)	Before Hedge Accounting			After Hedge Accounting			% Change
September 30, 2019		($3.5	)		($0.1	)	97	%
September 30, 2018	(3.3		)	(0.5		)	85

The additional volume of derivatives from updating our interest-rate risk measures to include upfront fees (including buy-downs) related to single-family credit guarantee activity, and the volatility in market interest rates in 3Q 2019 created variability in our GAAP adverse scenarios during 3Q 2019. While the September 30, 2019 GAAP adverse scenario shows a 97% reduction after hedge accounting, this result includes the effect of the new hedge accounting strategy implemented in September 2019, which was not in effect for the entire quarter. As a result, the average GAAP adverse scenario after hedge accounting was higher during 3Q 2019 than it was as of September 30, 2019. With the implementation of the new hedge accounting strategy in September 2019, we expect the GAAP adverse scenario after hedge accounting in future periods to be similar to the result as of September 30, 2019.

The table below shows the average, minimum, and maximum GAAP adverse scenario before hedge accounting and after hedge accounting during 3Q 2019.

Freddie Mac Form 10-Q 39

Management's Discussion and Analysis Risk Management 

Table 26 - GAAP Adverse Scenario Average, Minimum, and Maximum

	3Q 2019
	GAAP Adverse Scenario (Before-Tax)
(In billions)	Before Hedge Accounting			After Hedge Accounting
Average		($4.0	)		($0.7	)
Minimum	(3.2		)	(0.1		)
Maximum	(5.2		)	(1.8		)

Hedge accounting is designed to reduce the impact to GAAP earnings in the adverse scenario described above. However, the after hedge accounting impact may not always result in an improvement over the before hedge accounting impact. For example, there are certain interest-rate scenarios in which the after hedge accounting impact would result in a lower gain or a larger loss than the before hedge accounting impact.

Net Interest Rate Effect on Comprehensive Income (Loss)

The table below presents the effect of derivatives used in our interest-rate risk management activities on our comprehensive income (loss), net of tax, after considering any offsetting interest rate effects related to financial instruments measured at fair value and the effects of fair value hedge accounting.

Table 27 - Estimated Net Interest Rate Effect on Comprehensive Income (Loss)

(In billions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Interest-rate effect on derivative fair values		($2.8	)		$1.4			($9.3	)		$5.5
Estimate of offsetting interest-rate effect related to financial instruments measured at fair value(1)	1.3			(1.0		)	4.4			(3.6		)
Gains (losses) on mortgage loans and debt in fair value hedge relationships	1.2			(0.6		)	4.5			(2.5		)
Amortization of deferred hedge accounting gains and losses	(0.2		)	0.1			(0.2		)	0.2
Income tax (expense) benefit	0.1			—			0.1			0.1
Estimated net interest rate effect on comprehensive income (loss)		($0.4	)		($0.1	)		($0.5	)		($0.3	)

(1) Includes the interest-rate effect on our trading securities, available-for-sale securities, mortgage loans held-for-sale, and other assets and debt for which we elected the fair value option, which is reflected in non-interest income (loss) and total other comprehensive income (loss) on our condensed consolidated statements of comprehensive income.

The effect from the change in interest rates on derivative fair values is mostly offset by the effect from the change in interest rates related to financial instruments measured at fair value and gains and losses on mortgage loans and debt in fair value hedging relationships. However, the estimated net interest rate effect on comprehensive income (loss) in 3Q 2019 was higher than in prior periods as a result of the additional volume of derivatives and volatility in market interest rates during 3Q 2019. The remaining net interest-rate effect on comprehensive income is largely attributable to the following:

n The reversal of previously recognized derivative gains and losses,

n The implied net cost on instruments such as swaptions, futures, and forward purchase and sale commitments from our hedging and interest-rate risk management activities, which are recognized in GAAP earnings over time as a component of derivative gains and losses as the instruments approach maturity, and

n The amortization of previously deferred hedge accounting gains and losses, which we recognized in interest income over the contractual life of the hedged item.

Freddie Mac Form 10-Q 40

Management's Discussion and Analysis Risk Management 

Spread Volatility

We have limited ability to manage our spread risk exposure in a cost beneficial manner, and therefore the volatility of market spreads may contribute to significant GAAP earnings variability. For financial assets measured at fair value, we generally recognize fair value losses when market spreads widen. Conversely, for financial liabilities measured at fair value, we generally recognize fair value gains when market spreads widen. The table below shows the estimated effect of spreads on our comprehensive income (loss), after tax, by segment.

Table 28 - Estimated Spread Effect on Comprehensive Income (Loss)

(In billions)	3Q 2019			3Q 2018		YTD 2019			YTD 2018
Capital Markets		$0.2			$0.1		$0.3			$0.3
Multifamily	(0.1		)	—		(0.2		)	0.1
Single-family Guarantee(1)	—			—		—			—
Spread effect on comprehensive income (loss)		$0.1			$0.1		$0.1			$0.4

(1) Represents spread exposure on certain STACR debt securities for which we have elected the fair value option.

Freddie Mac Form 10-Q 41

Management's Discussion and Analysis Liquidity and Capital Resources 

LIQUIDITY AND CAPITAL RESOURCES

Our business activities require that we maintain adequate liquidity to meet our financial obligations as they come due and meet the needs of customers in a timely and cost-efficient manner. We also must maintain adequate capital resources to avoid being placed into receivership by FHFA. For further discussion of our liquidity framework and profile, see MD&A - Liquidity and Capital Resources in our 2018 Annual Report.

Liquidity

Primary Sources of Liquidity

The following table lists the sources of our liquidity, the balances as of September 30, 2019, and a brief description of their importance to Freddie Mac.

Table 29 - Sources of Liquidity

Source		Balance(1)  (In billions)			Description
Liquidity
•	Other Investments Portfolio - Liquidity and Contingency Operating Portfolio		$52.4	•	The liquidity and contingency operating portfolio, included within our other investments portfolio, is primarily used for short-term liquidity management.
•	Liquid Portion of the Mortgage-Related Investments Portfolio		$120.8	•	The liquid portion of our mortgage-related investments portfolio can be pledged or sold for liquidity purposes. The amount of cash we may be able to successfully raise may be substantially less than the balance.

(1) Represents carrying value for the liquidity and contingency operating portfolio, included within our other investments portfolio, and UPB for the liquid portion of the mortgage-related investments portfolio.

Other Investments Portfolio

The investments in our other investments portfolio are important to our cash flow, collateral management, asset and liability management, and ability to provide liquidity and stability to the mortgage market. The table below summarizes the balances in our other investments portfolio, which includes the liquidity and contingency operating portfolio.

Table 30 - Other Investments Portfolio

	September 30, 2019								December 31, 2018
(In billions)	Liquidity and Contingency Operating Portfolio		Custodial Account		Other		Total Other Investments Portfolio		Liquidity and Contingency Operating Portfolio		Custodial Account		Other		Total Other Investments Portfolio
Cash and cash equivalents		$5.1		$3.6		$—		$8.7		$6.7		$0.6		$—		$7.3
Securities purchased under agreements to resell	27.6		21.4		2.2		51.2		20.2		12.1		2.5		34.8
Non-mortgage related securities	19.7		—		4.6		24.3		16.8		—		2.4		19.2
Secured lending and other	—		—		5.4		5.4		—		—		1.8		1.8
Total		$52.4		$25.0		$12.2		$89.6		$43.7		$12.7		$6.7		$63.1

Our non-mortgage-related investments in the liquidity and contingency operating portfolio consist of U.S. Treasury securities and other investments that we could sell to provide us with an additional source of liquidity to fund our business operations. We also maintain non-interest-bearing deposits at the Federal Reserve Bank of New York and interest-bearing deposits at commercial banks. Our interest-bearing deposits at commercial banks totaled $4.0 billion and $1.5 billion as of September 30, 2019 and December 31, 2018, respectively.

The liquidity and contingency operating portfolio also included collateral posted to us in the form of cash primarily by derivatives counterparties of $3.1 billion and $3.0 billion as of September 30, 2019 and December 31, 2018, respectively. We have invested this collateral in securities purchased under agreements to resell and non-mortgage-related securities as part of our liquidity and contingency operating portfolio, although the collateral may be subject to return to our counterparties based on the terms of our master netting and collateral agreements.

Freddie Mac Form 10-Q 42

Management's Discussion and Analysis Liquidity and Capital Resources 

Mortgage Loans and Mortgage-Related Securities

We invest principally in mortgage loans and mortgage-related securities, certain categories of which are largely unencumbered and liquid. Our primary source of liquidity among these mortgage assets is our holdings of single-class and multiclass agency securities, excluding certain structured agency securities collateralized by non-agency mortgage-related securities. Our ability to pledge certain of these assets as collateral or sell them enhances our liquidity profile, although the amount of cash we may be able to successfully raise in the event of a liquidity crisis or significant market disruption may be substantially less than the amount of mortgage-related assets we hold. See Conservatorship and Related Matters for additional details on the liquidity of our mortgage-related investments portfolio.

Primary Sources of Funding

The following table lists the sources and balances of our funding as of September 30, 2019 and a brief description of their importance to Freddie Mac.

Table 31 - Sources of Funding

Source		Balance(1)  (In billions)			Description
Funding
•	Other Debt		$281.6	•	Other debt is used to fund our business activities, including single-family guarantee activities not funded by debt securities of consolidated trusts.
•	Debt Securities of Consolidated Trusts		$1,869.3	•	Debt securities of consolidated trusts are used primarily to fund our single-family guarantee activities. This type of debt is principally repaid by the cash flows of the associated mortgage loans. As a result, our repayment obligation is limited to amounts paid pursuant to our guarantee of principal and interest and purchasing modified or seriously delinquent loans from the trusts.

(1) Represents UPB of debt balances.

Other Debt Activities

We issue other debt to fund our business activities. Competition for funding can vary with economic, financial market, and regulatory environments. We issue other debt based on a variety of factors, including market conditions and our liquidity requirements. We currently favor a mix of derivatives and shorter-term and callable debt to fund our business and manage interest-rate risk. Generally, this funding mix is a less expensive method than relying more extensively on long-term debt.

The table below summarizes the par value and the average rate of other debt securities we issued or paid off, including regularly scheduled principal payments, payments resulting from calls, and payments for repurchases. We call, exchange, or repurchase our outstanding debt securities from time to time for a variety of reasons, including managing our funding composition and supporting the liquidity of our debt securities.

Freddie Mac Form 10-Q 43

Management's Discussion and Analysis Liquidity and Capital Resources 

Table 32 - Other Debt Activity

	3Q 2019										YTD 2019
(Dollars in millions)	Short-term			Average Rate(1)		Long-term			Average Rate(1)		Short-term			Average Rate(1)		Long-term			Average Rate(1)
Discount notes and Reference Bills®
Beginning balance		$35,362		2.41	%		$—		—	%		$28,787		2.36	%		$—		—	%
Issuances	82,414			2.05		—			—		267,915			2.24		—			—
Repurchases	—			—		—			—		—			—		—			—
Maturities	(75,057		)	2.20		—			—		(253,983		)	2.28		—			—
Ending Balance	42,719			2.09		—			—		42,719			2.09		—			—
Securities sold under agreements to repurchase
Beginning balance	9,549			2.30		—			—		6,019			2.40		—			—
Additions	111,886			2.19		—			—		213,335			2.30		—			—
Repayments	(112,735		)	2.21		—			—		(210,654		)	2.32		—			—
Ending Balance	8,700			2.06		—			—		8,700			2.06		—			—
Callable debt
Beginning balance	12,590			2.49		113,394			2.16		2,000			2.53		105,206			2.09
Issuances	1,000			2.30		28,627			2.22		13,590			2.48		74,293			2.55
Repurchases	—			—		—			—		—			—		—			—
Calls	(10,590		)	2.49		(31,077		)	2.59		(12,590		)	2.53		(59,885		)	2.82
Maturities	—			—		(8,494		)	1.38		—			—		(17,164		)	1.32
Ending Balance	3,000			2.43		102,450			2.11		3,000			2.43		102,450			2.11
Non-callable debt
Beginning balance	13,596			2.50		77,539			2.75		14,440			2.04		80,789			2.56
Issuances	29,256			2.27		5,485			2.27		47,562			2.35		15,775			2.43
Repurchases	(345		)	1.87		—			—		(345		)	1.87		(774		)	1.82
Maturities	(2,409		)	2.38		(14,515		)	1.33		(21,559		)	2.17		(27,281		)	1.65
Ending Balance	40,098			2.33		68,509			3.02		40,098			2.33		68,509			3.02
STACR and SCR Debt(2)
Beginning balance	—			—		16,971			6.16		—			—		17,729			6.02
Issuances	—			—		—			—		—			—		280			2.48
Repurchases	—			—		—			—		—			—		—			—
Maturities	—			—		(883		)	4.24		—			—		(1,921		)	4.47
Ending Balance	—			—		16,088			5.98		—			—		16,088			5.98
Total other debt		$94,517		2.20	%		$187,047		2.78	%		$94,517		2.20	%		$187,047		2.78	%

(1) Average rate is weighted based on par value.

(2) Includes STACR and SCR debt notes and certain multifamily other debt. STACR and SCR debt notes are subject to prepayment risk as their payments are based upon the performance of a reference pool of mortgage assets that may be prepaid by the related mortgage borrower at any time generally without penalty.

Our outstanding other debt balance increased during the 2019 periods, driven by an increase in the issuance of short-term SOFR debt primarily due to higher near-term cash needs for upcoming debt maturities and anticipated calls.

Freddie Mac Form 10-Q 44

Management's Discussion and Analysis Liquidity and Capital Resources 

Maturity and Redemption Dates

The following graphs present our other debt by contractual maturity date and earliest redemption date. The earliest redemption date refers to the earliest call date for callable debt and the contractual maturity date for all other debt.

Contractual Maturity Date as of September 30, 2019⁽¹⁾ 

Earliest Redemption Date as of September 30, 2019⁽¹⁾ 

(1) STACR and SCR debt notes are subject to prepayment risk as their payments are based upon the performance of a reference pool of mortgage assets that may be prepaid by the related mortgage borrower at any time generally without penalty and are therefore included as a separate category in the graphs.

Debt Securities of Consolidated Trusts

The largest component of debt on our condensed consolidated balance sheets is debt securities of consolidated trusts, which relates to securitization transactions that we consolidated for accounting purposes. We issue this type of debt by securitizing mortgage loans primarily to fund the majority of our single-family guarantee activities. When we consolidate securitization trusts, we recognize the following on our condensed consolidated balance sheets:

n The assets held by the securitization trusts, the majority of which are mortgage loans. We recognized $1,905.6 billion and $1,842.9 billion of mortgage loans, which represented 87.8% and 89.3% of our total assets, as of September 30, 2019 and December 31, 2018, respectively.

n The debt securities issued by the securitization trusts, the majority of which are Level 1 securitizations that are pass-through securities, where the cash flows of the mortgage loans held by the securitization trust are passed through to the holders of the securities. We recognized $1,869.3 billion and $1,792.7 billion of debt securities of consolidated trusts, which represented 87.0% and 87.7% of our total debt, as of September 30, 2019 and December 31, 2018, respectively.

Debt securities of consolidated trusts are principally repaid from the cash flows of the mortgage loans held by the securitization trusts that issued the debt securities. In circumstances when the cash flows of the mortgage loans are not sufficient to repay the debt, we make up the shortfall because we have guaranteed the payment of principal and interest on the debt. In certain circumstances, we have the right and/or obligation to purchase the loan from the trust prior to its contractual maturity.

Freddie Mac Form 10-Q 45

Management's Discussion and Analysis Liquidity and Capital Resources 

The table below shows the issuance and extinguishment activity for the debt securities of our consolidated trusts.

Table 33 - Activity for Debt Securities of Consolidated Trusts Held by Third Parties

(In millions)	3Q 2019			YTD 2019
Beginning balance		$1,784,229			$1,748,738
Issuances:
New issuances to third parties	100,666			216,071
Additional issuances of securities	56,495			121,537
Total issuances	157,161			337,608
Extinguishments:
Purchases of debt securities from third parties	(12,556		)	(25,526		)
Debt securities received in settlement of secured lending	(12,816		)	(28,066		)
Repayments of debt securities	(91,312		)	(208,048		)
Total extinguishments	(116,684		)	(261,640		)
Ending balance	1,824,706			1,824,706
Unamortized premiums and discounts	44,602			44,602
Debt securities of consolidated trusts held by third parties		$1,869,308			$1,869,308

Cash Flows

Cash and cash equivalents (including restricted cash and cash equivalents) increased by $1.7 billion from September 30, 2018 to September 30, 2019, primarily driven by an increase in proceeds from the issuance of debt for upcoming maturities and anticipated calls of other debt.

Capital Resources

Primary Sources of Capital

Our entry into conservatorship resulted in significant changes to the assessment of our capital adequacy and our management of capital. Under the Purchase Agreement, Treasury made a commitment to provide us with funding, under certain conditions, to eliminate deficits in our net worth. At September 30, 2019, our assets exceeded our liabilities under GAAP; therefore, no draw is being requested from Treasury under the Purchase Agreement. Based on our Net Worth Amount of $6.7 billion and the applicable Capital Reserve Amount of $20.0 billion, we will not have a dividend requirement to Treasury in December 2019. See Note 2 for details of the support we receive from Treasury.

The table below presents activity related to our net worth during 3Q 2019 and YTD 2019.

Table 34 - Net Worth Activity

(In millions)	3Q 2019		YTD 2019
Beginning balance		$4,826		$4,477
Comprehensive income (loss)	1,848		5,339
Capital draw from Treasury	—		—
Senior preferred stock dividends declared	—		(3,142		)
Total equity / net worth		$6,674		$6,674
Aggregate draws under Purchase Agreement		$71,648		$71,648
Aggregate cash dividends paid to Treasury	119,680		119,680

Conservatorship Capital Framework

In May 2017, FHFA, as Conservator, issued guidance to us to evaluate and manage our financial risk and to make economic business decisions, while in conservatorship, utilizing a newly-developed risk-based CCF, an economic capital system with detailed formulae provided by FHFA. The CCF also provides the foundation for the risk-based component of the proposed Enterprise Capital Rule published by FHFA in the Federal Register in July 2018.

Freddie Mac Form 10-Q 46

Management's Discussion and Analysis Liquidity and Capital Resources

We have adopted the CCF for internal capital measurement to evaluate business decisions and ensure the company makes such decisions prudently when pricing transactions and managing its businesses. This framework focuses on the profits earned versus an estimated cost of equity capital needed to support the risk assumed to generate those profits.

The existing regulatory capital requirements have been suspended by FHFA during conservatorship. Consequently, we refer to the capital needed under the CCF for analysis of transactions and businesses as "conservatorship capital."

Under the Purchase Agreement and the September 2019 Letter Agreement, we are not able to retain equity, as calculated under GAAP, in excess of the $20.0 billion Capital Reserve Amount. As a result, we do not have capital sufficient to support our aggregate risk-taking activities.

Return on Conservatorship Capital

The table below provides the ROCC, calculated as (1) annualized comprehensive income for the period divided by (2) average conservatorship capital during the period. Each quarter, we consider whether certain "significant items" occurred that should be excluded from comprehensive income for our calculation of ROCC. If we have identified significant items in any of the periods presented, we also include comprehensive income excluding significant items as well as an adjusted ROCC based on comprehensive income excluding significant items, both non-GAAP measures. We believe that these non-GAAP financial measures are useful to investors as they better reflect our on-going financial results.

The ROCC shown in the table below is not based on our total equity and does not reflect actual returns on total equity. We do not believe that returns on total equity are meaningful because of the net worth limit imposed since 2012 under the Purchase Agreement.

Table 35 - Return on Conservatorship Capital⁽¹⁾

(Dollars in billions)	3Q 2019	3Q 2018	YTD 2019	YTD 2018
GAAP comprehensive income	$1.8	$2.6	$5.3	$7.1
Significant items:
Non-agency mortgage-related securities judgment(2)	—	—	—	(0.3)
Tax effect related to judgment(2)	—	—	—	0.1
Total significant items(3)	—	—	—	(0.2)
Comprehensive income, excluding significant items(3)	$1.8	$2.6	$5.3	$6.9
Conservatorship capital (average during the period)(4)	$51.3	$56.5	$51.8	$57.5
ROCC, based on GAAP comprehensive income(4)	14.4%	18.1%	13.7%	16.6%
Adjusted ROCC, based on comprehensive income excluding significant items(3)(4)	14.4%	18.1%	13.7%	16.0%

(1) Average conservatorship capital and ROCC for 3Q 2019 and YTD 2019 are preliminary and subject to change until official submission to FHFA.

(2) YTD 2018 GAAP comprehensive income included a benefit of $334 million (pre-tax) from a final judgment against Nomura Holding America, Inc. in litigation involving certain of our non-agency mortgage-related securities. The tax effect related to this judgment was ($70) million.

(3) No significant items were identified for the 2019 periods. Numbers for the 2019 periods are included for comparison purposes only.

(4) Average conservatorship capital for each period is based on the CCF in effect during that period, except that the 2018 figures have been revised to include capital for deferred tax assets. The CCF in effect as of September 30, 2019 was largely unchanged from the CCF as of June 30, 2019.

Our ROCC and Adjusted ROCC for 3Q 2019 and YTD 2019 decreased compared to the returns for the 2018 periods, primarily driven by the decrease in comprehensive income, partially offset by the lower level of conservatorship capital needed, resulting from an increase in CRT activity in both our Single-family Guarantee and Multifamily segments, home price appreciation, the efficient disposition of legacy assets, and a decrease in our deferred tax assets.

We find the returns calculated above, as well as the returns calculated on specific transactions and individual business lines, to be a reasonable measure of return-versus-risk to support our decision-making while we remain in conservatorship. These returns may not be indicative of the returns that would be generated if we were to exit conservatorship, especially as the terms and timing of any such exit are not currently known and will depend upon future actions by the U.S. government. Our belief, should we leave conservatorship, is that returns at that time would most likely be below the levels calculated above, assuming the same portfolio of risk assets, as we expect that we would hold capital post-conservatorship above the minimum required regulatory capital. It is also likely that we would be required to pay fees for federal government support, thereby reducing our total comprehensive income.

Freddie Mac Form 10-Q 47

Management's Discussion and Analysis Liquidity and Capital Resources

OFF-BALANCE SHEET ARRANGEMENTS

We enter into certain off-balance sheet arrangements related to our securitization activities involving guaranteed loans and mortgage-related securities, though most of our securitization activities are on-balance sheet. For a description of our off-balance sheet arrangements, see MD&A - Off-Balance Sheet Arrangements in our 2018 Annual Report. See Note 3 and Note 5 for more information on our off-balance sheet securitization and guarantee activities.

Our maximum potential off-balance sheet exposure to credit losses relating to these securitization activities and guarantees is primarily represented by the UPB of the underlying loans and securities, which was $283.5 billion and $254.9 billion at September 30, 2019 and December 31, 2018, respectively. The amount as of September 30, 2019 excludes Fannie Mae securities backing Freddie Mac resecuritization products discussed below.

With the implementation of the Single Security Initiative, we now have the ability to commingle TBA-eligible Fannie Mae collateral in certain of our resecuritization products. When we resecuritize Fannie Mae securities in our commingled resecuritization products, our guarantee covers timely payments of principal and interest on such securities. Accordingly, commingling Fannie Mae collateral in our resecuritization transactions increases our off-balance sheet exposure as we do not have control over the Fannie Mae collateral.

As of September 30, 2019, the total amount of our off-balance sheet exposure related to Fannie Mae securities backing Freddie Mac resecuritization products was approximately $17 billion. We expect this exposure to increase over time.

Freddie Mac Form 10-Q 48

Management's Discussion and Analysis Conservatorship and Related Matters

CONSERVATORSHIP AND RELATED MATTERS

Managing Our Mortgage-Related Investments Portfolio

The table below presents the UPB of our mortgage-related investments portfolio. In February 2019, FHFA directed us to maintain this portfolio at or below $225 billion at all times.

Table 36 - Mortgage-Related Investments Portfolio Details

	September 30, 2019												December 31, 2018
(Dollars in millions)	Liquid			Securitiz-ation Pipeline			Less Liquid			Total			Liquid			Securitiz-ation Pipeline			Less Liquid			Total
Capital Markets segment - Mortgage investments portfolio:
Single-family unsecuritized loans
Performing loans		$—			$20,823			$—			$20,823			$—			$8,955			$—			$8,955
Reperforming loans	—			—			29,982			29,982			—			—			39,402			39,402
Total single-family unsecuritized loans	—			20,823			29,982			50,805			—			8,955			39,402			48,357
Freddie Mac mortgage-related securities	108,282			—			2,665			110,947			109,880			—			3,108			112,988
Non-agency mortgage-related securities	—			—			1,585			1,585			—			—			2,122			2,122
Other Non-Freddie Mac agency mortgage-related securities	7,583			—			—			7,583			3,968			—			—			3,968
Total Capital Markets segment - Mortgage investments portfolio	115,865			20,823			34,232			170,920			113,848			8,955			44,632			167,435
Single-family Guarantee segment - Single-family unsecuritized seriously delinquent loans	—			—			8,330			8,330			—			—			8,473			8,473
Multifamily segment:
Unsecuritized loans	—			24,998			11,690			36,688			—			23,203			11,584			34,787
Mortgage-related securities	4,964			—			699			5,663			6,570			—			815			7,385
Total Multifamily segment	4,964			24,998			12,389			42,351			6,570			23,203			12,399			42,172
Total mortgage-related investments portfolio		$120,829			$45,821			$54,951			$221,601			$120,418			$32,158			$65,504			$218,080
Percentage of total mortgage-related investments portfolio	54		%	21		%	25		%	100		%	55		%	15		%	30		%	100		%

While we continued to purchase new single-family seriously delinquent loans from securities we guarantee and certain multifamily unsecuritized loans, which are classified as held-for-investment, our active disposition of less liquid assets during YTD 2019 included the following:

n Sales of $3.5 billion in UPB of single-family reperforming loans, $0.2 billion in UPB of seriously delinquent unsecuritized single-family loans, and $0.2 billion in UPB of single-family non-agency mortgage-related securities;

n Securitizations of $1.5 billion in UPB of less liquid multifamily loans; and

n Transfers of $0.4 billion in UPB of less liquid multifamily loans to the securitization pipeline.

Freddie Mac Form 10-Q 49

Management's Discussion and Analysis Conservatorship and Related Matters

FHFA's Strategic Plan and Scorecards for Freddie Mac and Fannie Mae Conservatorships

In October 2019, FHFA released a new Strategic Plan for the Conservatorships of Freddie Mac and Fannie Mae. The 2019 Strategic Plan provides a framework for how FHFA will guide Freddie Mac and Fannie Mae (the Enterprises) to fulfill their statutory missions, focus on safety and soundness, and prepare for a responsible end to the conservatorships.

The three objectives of this new Strategic Plan are to ensure that the Enterprises:

n Focus on their core mission responsibilities to foster competitive, liquid, efficient, and resilient (CLEAR) national housing finance markets that support sustainable homeownership and affordable rental housing;

n Operate in a safe and sound manner appropriate for entities in conservatorship; and

n Prepare for the Enterprises' eventual exists from conservatorships.

FHFA also released a new annual Conservatorship Scorecard for Freddie Mac, Fannie Mae, and Common Securitization Solutions. This new 2020 Conservatorship Scorecard aligns tactical priorities and execution at the Enterprises to the 2019 Strategic Plan and serves as a tool in holding the Enterprises accountable for its effective implementation

FHFA issued the 2019 and 2020 Conservatorship Scorecards in December 2018 and October 2019, respectively. We continue to align our resources and internal business plans to meet the goals and objectives provided by FHFA.

For information about how the Conservatorship Scorecard affects executive compensation, see the Compensation Discussion and Analysis section in our 2018 Annual Report. For information about the 2019 Conservatorship Scorecard, see our Current Report on Form 8-K filed on December 20, 2018. For information on the 2020 Conservatorship Scorecard, see our Current Report on Form 8-K filed on October 29, 2019.

Freddie Mac Form 10-Q 50

Management's Discussion and Analysis Regulation and Supervision

REGULATION AND SUPERVISION

In addition to our oversight by FHFA as our Conservator, we are subject to regulation and oversight by FHFA under our Charter and the GSE Act and to certain regulation by other government agencies. Furthermore, regulatory activities by other government agencies can affect us indirectly, even if we are not directly subject to such agencies' regulation or oversight. For example, regulations that modify requirements applicable to the purchase or servicing of mortgages can affect us.

Federal Housing Finance Agency

Affordable Housing Fund Allocations

The GSE Act requires us to set aside in each fiscal year an amount equal to 4.2 basis points of each dollar of total new business purchases, and pay this amount to certain housing funds. During 3Q 2019 and YTD 2019, we completed $163.2 billion and $365.4 billion, respectively, of new business purchases subject to this requirement and accrued $68 million and $153 million, respectively, of related expense. We are prohibited from passing through these costs to the originators of the loans that we purchase.

Legislative and Regulatory Developments

Treasury Housing Reform Plan

On September 5, 2019, Treasury released its plan to reform the housing finance system pursuant to the goals specified in the presidential memorandum issued on March 27, 2019. The Treasury Housing Reform Plan (the Plan) includes 49 recommended legislative and administrative reforms that would advance the reform goals outlined in the presidential memorandum: ending the conservatorships of the GSEs, facilitating competition in the housing finance system, establishing regulation of the GSEs that safeguards their safety and soundness and minimizes the risks they pose to the financial stability of the United States, and providing that the federal government is properly compensated for any explicit or implicit support it provides to the GSEs or the secondary housing finance market.

Among other things, Treasury states that its preference and recommendation is for Congress to enact comprehensive housing finance reform legislation. Specifically, the Plan indicates that legislative reforms should replace the existing GSE Purchase Agreements with an explicit, paid-for guarantee backed by the full faith and credit of the federal government that is limited to the timely payment of principal and interest on qualifying MBS. The explicit government guarantee should be available to re-chartered GSEs and to any other FHFA-approved guarantors of MBS collateralized by eligible conventional mortgage loans or eligible multifamily mortgage loans. Further, the government’s guarantee would stand behind significant first-loss private capital and would be triggered only in exigent circumstances. 

To ensure stability in the housing finance system pending comprehensive housing finance reform legislation, the Plan indicates that it will be necessary to maintain limited and tailored government support for the GSEs by leaving the Purchase Agreement commitments in place after the GSE conservatorships. The Plan notes that the government should be compensated for its continued support through a periodic commitment fee.

The Plan also indicates that FHFA should begin the process of ending the GSE conservatorships. It recommends that the Purchase Agreements be amended to enhance Treasury’s ability to mitigate the risk of a draw on the commitments after the conservatorships have ended. It also indicates that other Purchase Agreement amendments should ensure that each GSE continues to be subject to appropriate mission and safety and soundness regulation after conservatorship and that future GSE activities are limited to those that have a close nexus to the underlying rationale for government support.

Treasury has indicated that it will continue to support FHFA’s administrative actions to enhance regulation of the GSEs, promote private sector competition, and satisfy preconditions for ending the GSEs’ conservatorships. We cannot predict whether Congress will enact legislation or FHFA will take administrative action that is consistent with these recommendations.

Freddie Mac Form 10-Q 51

Management's Discussion and Analysis Regulation and Supervision

Affordable Housing Goal Results for 2018In September 2019, FHFA informed us that it had reviewed our performance with respect to affordable housing goals for 2018 and preliminarily determined that we achieved all five of our single-family affordable housing goals and all three of our multifamily goals. We may achieve a single-family or multifamily housing goal by meeting or exceeding the FHFA benchmark for that goal (Goal). We also may achieve a single-family housing goal by meeting or exceeding the actual share of the market that meets the criteria for that goal (Market Level). Our performance on the goals, as preliminarily determined by FHFA, is set forth in the table below.

Table 37 - 2018 Affordable Housing Goal Results

	Goals for 2018		Market Levels for 2018		Preliminary Results for 2018
Single-family purchase money goals (benchmark levels)
Low-income goal	24	%	25.5	%	25.8	%
Very low-income goal	6	%	6.5	%	6.3	%
Low-income areas goal	18	%	22.6	%	22.6	%
Low-income areas subgoal	14	%	18.0	%	17.3	%
Single-family refinance (benchmark level)
Low-income goal	21	%	30.7	%	27.3	%
Multifamily (benchmark levels in units)
Low-income goal	315,000		N/A		474,062
Very low-income subgoal	60,000		N/A		105,612
Small property low-income subgoal	10,000		N/A		39,353

Freddie Mac Form 10-Q 52

Management's Discussion and Analysis Forward-Looking Statements

FORWARD-LOOKING STATEMENTS

We regularly communicate information concerning our business activities to investors, the news media, securities analysts, and others as part of our normal operations. Some of these communications, including this Form 10-Q, contain "forward-looking statements." Examples of forward-looking statements include, but are not limited to, statements pertaining to the conservatorship, our current expectations and objectives for the Single-family Guarantee, Multifamily, and Capital Markets segments of our business, our efforts to assist the housing market, our liquidity and capital management, economic and market conditions and trends, our market share, the effect of legislative and regulatory developments and new accounting guidance, the credit quality of loans we own or guarantee, the costs and benefits of our CRT transactions, and our results of operations and financial condition on a GAAP, Segment Earnings, and fair value basis. Forward-looking statements involve known and unknown risks and uncertainties, some of which are beyond our control. Forward-looking statements are often accompanied by, and identified with, terms such as "could," "may," "will," "believe," "expect," "anticipate," "forecast," and similar phrases. These statements are not historical facts, but rather represent our expectations based on current information, plans, judgments, assumptions, estimates, and projections. Actual results may differ significantly from those described in or implied by such forward-looking statements due to various factors and uncertainties, including those described in the Risk Factors section of the Form 10-Q for the quarter ended June 30, 2019 and our 2018 Annual Report, and:

n The actions the U.S. government (including FHFA, Treasury, and Congress) may take, or require us to take, including to support the housing markets or to implement the recommendations in the Treasury Housing Reform Plan or FHFA's Conservatorship Scorecards and other objectives for us;

n The effect of the restrictions on our business due to the conservatorship and the Purchase Agreement, including our dividend requirement on the senior preferred stock;

n Changes in our Charter or in applicable legislative or regulatory requirements (including changes pursuant to the Treasury Housing Reform Plan or pursuant to any legislation affecting the future status of our company);

n Changes in the fiscal and monetary policies of the Federal Reserve, including the balance sheet normalization program to reduce the Federal Reserve's holdings of mortgage-related securities;

n Changes in tax laws;

n Changes in accounting policies, practices, or guidance (e.g., FASB's accounting standards update related to the measurement of credit losses of financial instruments);

n Changes in economic and market conditions, including changes in employment rates, interest rates, spreads, and home prices;

n Changes in the U.S. residential mortgage market, including changes in the supply and type of loan products (e.g., refinance vs. purchase and fixed-rate vs. ARM);

n The success of our efforts to mitigate our losses on our legacy and relief refinance single-family loan portfolio;

n The success of our strategy to transfer mortgage credit risk through STACR debt note, STACR Trust, ACIS, K Certificate, SB Certificate, and other CRT transactions;

n Our ability to maintain adequate liquidity to fund our operations;

n Our ability to maintain the security and resiliency of our operational systems and infrastructure, including against cyberattacks;

n Our ability to effectively execute our business strategies, implement new initiatives, and improve efficiency;

n The adequacy of our risk management framework, including the adequacy of the CCF for measuring risk;

n Our ability to manage mortgage credit risk, including the effect of changes in underwriting and servicing practices;

n Our ability to limit or manage our economic exposure and GAAP earnings exposure to interest-rate volatility and spread volatility, including the availability of derivative financial instruments needed for interest-rate risk management purposes;

n Our operational ability to issue new securities, make timely and correct payments on securities, and provide initial and ongoing disclosures;

n Our reliance on CSS and the CSP for the operation of the majority of our single-family securitization activities;

n Changes or errors in the methodologies, models, assumptions, and estimates we use to prepare our financial statements, make business decisions, and manage risks;

n Changes in investor demand for our debt or mortgage-related securities, as well as market acceptance of the UMBS;

n Changes in the practices of loan originators, servicers, investors, and other participants in the secondary mortgage market;

n The occurrence of a major natural or other disaster in areas in which our offices or significant portions of our total mortgage portfolio are located; and

n Other factors and assumptions described in this Form 10-Q and our 2018 Annual Report, including in the MD&A section.

Forward-looking statements are made only as of the date of this Form 10-Q, and we undertake no obligation to update any forward-looking statements we make to reflect events or circumstances occurring after the date of this Form 10-Q.

Freddie Mac Form 10-Q 53

Financial Statements

Financial Statements

Freddie Mac Form 10-Q 54

Financial Statements Condensed Consolidated Statements of Comprehensive Income

FREDDIE MAC

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

(In millions, except share-related amounts)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Interest income
Mortgage loans		$16,428			$16,787			$51,732			$49,082
Investments in securities	686			755			2,059			2,295
Other	426			261			1,197			703
Total interest income	17,540			17,803			54,988			52,080
Interest expense	(15,130		)	(14,546		)	(46,498		)	(42,802		)
Net interest income	2,410			3,257			8,490			9,278
Benefit (provision) for credit losses	179			380			474			377
Net interest income after benefit (provision) for credit losses	2,589			3,637			8,964			9,655
Non-interest income (loss)
Guarantee fee income	231			209			670			603
Mortgage loans gains (losses)	1,702			94			4,174			233
Investment securities gains (losses)	164			(443		)	728			(1,024		)
Debt gains (losses)	(56		)	158			8			445
Derivative gains (losses)	(1,217		)	728			(4,912		)	2,974
Other income (loss)	146			79			389			648
Non-interest income (loss)	970			825			1,057			3,879
Non-interest expense
Salaries and employee benefits	(333		)	(301		)	(983		)	(890		)
Professional services	(115		)	(120		)	(342		)	(335		)
Other administrative expense	(172		)	(148		)	(492		)	(422		)
Total administrative expense	(620		)	(569		)	(1,817		)	(1,647		)
Real estate owned operations expense	(58		)	(38		)	(172		)	(87		)
Temporary Payroll Tax Cut Continuation Act of 2011 expense	(408		)	(375		)	(1,197		)	(1,100		)
Other expense	(337		)	(218		)	(1,036		)	(619		)
Non-interest expense	(1,423		)	(1,200		)	(4,222		)	(3,453		)
Income (loss) before income tax (expense) benefit	2,136			3,262			5,799			10,081
Income tax (expense) benefit	(427		)	(556		)	(1,177		)	(1,946		)
Net income (loss)	1,709			2,706			4,622			8,135
Other comprehensive income (loss), net of taxes and reclassification adjustments:
Changes in unrealized gains (losses) related to available-for-sale securities	124			(169		)	674			(1,065		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	19			25			57			87
Changes in defined benefit plans	(4		)	(3		)	(14		)	(13		)
Total other comprehensive income (loss), net of taxes and reclassification adjustments	139			(147		)	717			(991		)
Comprehensive income (loss)		$1,848			$2,559			$5,339			$7,144
Net income (loss)		$1,709			$2,706			$4,622			$8,135
Undistributed net worth sweep, senior preferred stock dividends, or future increase in senior preferred stock liquidation preference	(1,848		)	(2,559		)	(5,339		)	(4,144		)
Net income (loss) attributable to common stockholders		($139	)		$147			($717	)		$3,991
Net income (loss) per common share — basic and diluted		($0.04	)		$0.05			($0.22	)		$1.23
Weighted average common shares outstanding (in millions) — basic and diluted	3,234			3,234			3,234			3,234

The accompanying notes are an integral part of these condensed consolidated financial statements.

Freddie Mac Form 10-Q 55

Financial Statements Condensed Consolidated Balance Sheets

FREDDIE MAC

Condensed Consolidated Balance Sheets (Unaudited)

	September 30,			December 31,
(In millions, except share-related amounts)	2019			2018
Assets
Cash and cash equivalents (Notes 1, 3, 14) (includes $3,560 and $596 of restricted cash and cash equivalents)		$8,708			$7,273
Securities purchased under agreements to resell (Notes 3, 10)	51,187			34,771
Investments in securities, at fair value (Note 7)	72,982			69,111
Mortgage loans held-for-sale (Notes 3, 4) (includes $21,538 and $23,106 at fair value)	41,118			41,622
Mortgage loans held-for-investment (Notes 3, 4) (net of allowance for loan losses of $4,854 and $6,139)	1,956,372			1,885,356
Accrued interest receivable (Note 3)	6,790			6,728
Derivative assets, net (Notes 9, 10)	1,592			335
Deferred tax assets, net (Note 12)	5,784			6,888
Other assets (Notes 3, 18) (includes $4,590 and $3,929 at fair value)	25,713			10,976
Total assets		$2,170,246			$2,063,060
Liabilities and equity
Liabilities
Accrued interest payable (Note 3)		$6,688			$6,652
Debt, net (Notes 3, 8) (includes $4,600 and $5,112 at fair value)	2,149,259			2,044,950
Derivative liabilities, net (Notes 9, 10)	355			583
Other liabilities (Notes 3, 18)	7,270			6,398
Total liabilities	2,163,572			2,058,583
Commitments and contingencies (Notes 5, 9, 16)
Equity (Note 11)
Senior preferred stock (redemption value of $77,474 and $75,648)	72,648			72,648
Preferred stock, at redemption value	14,109			14,109
Common stock, $0.00 par value, 4,000,000,000 shares authorized, 725,863,886 shares issued and 650,059,033 shares and 650,058,775 shares outstanding	—			—
Additional paid-in capital	—			—
Retained earnings (accumulated deficit)	(76,780		)	(78,260		)
AOCI, net of taxes, related to:
Available-for-sale securities (includes $243 and $221, related to net unrealized gains on securities for which other-than-temporary impairment has been recognized in earnings)	757			83
Cash flow hedge relationships	(258		)	(315		)
Defined benefit plans	83			97
Total AOCI, net of taxes	582			(135		)
Treasury stock, at cost, 75,804,853 shares and 75,805,111 shares	(3,885		)	(3,885		)
Total equity (See Note 11 for information on our dividend requirement to Treasury)	6,674			4,477
Total liabilities and equity		$2,170,246			$2,063,060

The table below presents the carrying value and classification of the assets and liabilities of consolidated VIEs on our condensed consolidated balance sheets.

	September 30,		December 31,
(In millions)	2019		2018
Consolidated Balance Sheet Line Item
Assets: (Note 3)
Mortgage loans held-for-investment		$1,905,633		$1,842,850
All other assets	43,863		20,237
Total assets of consolidated VIEs		$1,949,496		$1,863,087
Liabilities: (Note 3)
Debt, net		$1,869,308		$1,792,677
All other liabilities	5,519		5,335
Total liabilities of consolidated VIEs		$1,874,827		$1,798,012

The accompanying notes are an integral part of these condensed consolidated financial statements.

Freddie Mac Form 10-Q 56

Financial Statements Condensed Consolidated Statements of Equity

FREDDIE MAC

Condensed Consolidated Statements of Equity (Unaudited)

	Shares Outstanding			Senior Preferred Stock		Preferred Stock, at Redemption Value		Common Stock, at Par Value		Additional Paid-In Capital		Retained Earnings (Accumulated Deficit)			AOCI, Net of Tax			Treasury Stock, at Cost			Total Equity
(In millions)	Senior Preferred Stock	Preferred Stock	Common Stock
Balance at June 30, 2019	1	464	650		$72,648		$14,109		$—		$—		($78,489	)		$443			($3,885	)		$4,826
Comprehensive income (loss):
Net income (loss)	—	—	—	—		—		—		—		1,709			—			—			1,709
Other comprehensive income (loss), net of taxes	—	—	—	—		—		—		—		—			139			—			139
Comprehensive income (loss)	—	—	—	—		—		—		—		1,709			139			—			1,848
Ending balance at September 30, 2019	1	464	650		$72,648		$14,109		$—		$—		($76,780	)		$582			($3,885	)		$6,674
Balance at June 30, 2018	1	464	650		$72,648		$14,109		$—		$—		($77,921	)		($366	)		($3,885	)		$4,585
Comprehensive income (loss):
Net income (loss)	—	—	—	—		—		—		—		2,706			—			—			2,706
Other comprehensive income (loss), net of taxes	—	—	—	—		—		—		—		—			(147		)	—			(147		)
Comprehensive income (loss)	—	—	—	—		—		—		—		2,706			(147		)	—			2,559
Senior preferred stock dividends paid	—	—	—	—		—		—		—		(1,585		)	—			—			(1,585		)
Ending balance at September 30, 2018	1	464	650		$72,648		$14,109		$—		$—		($76,800	)		($513	)		($3,885	)		$5,559

	Shares Outstanding			Senior Preferred Stock		Preferred Stock, at Redemption Value		Common Stock, at Par Value		Additional Paid-In Capital		Retained Earnings (Accumulated Deficit)			AOCI, Net of Tax			Treasury Stock, at Cost			Total Equity
(In millions)	Senior Preferred Stock	Preferred Stock	Common Stock
Balance at December 31, 2018	1	464	650		$72,648		$14,109		$—		$—		($78,260	)		($135	)		($3,885	)		$4,477
Comprehensive income (loss):
Net income (loss)	—	—	—	—		—		—		—		4,622			—			—			4,622
Other comprehensive income (loss), net of taxes	—	—	—	—		—		—		—		—			717			—			717
Comprehensive income (loss)	—	—	—	—		—		—		—		4,622			717			—			5,339
Senior preferred stock dividends paid	—	—	—	—		—		—		—		(3,142		)	—			—			(3,142		)
Ending balance at September 30, 2019	1	464	650		$72,648		$14,109		$—		$—		($76,780	)		$582			($3,885	)		$6,674
Balance at December 31, 2017	1	464	650		$72,336		$14,109		$—		$—		($83,261	)		$389			($3,885	)		($312	)
Comprehensive income (loss):
Net income (loss)	—	—	—	—		—		—		—		8,135			—			—			8,135
Other comprehensive income (loss), net of taxes	—	—	—	—		—		—		—		—			(991		)	—			(991		)
Comprehensive income (loss)	—	—	—	—		—		—		—		8,135			(991		)	—			7,144
Cumulative effect of change in accounting principle	—	—	—	—		—		—		—		(89		)	89			—			—
Increase in liquidation preference	—	—	—	312		—		—		—		—			—			—			312
Senior preferred stock dividends paid	—	—	—	—		—		—		—		(1,585		)	—			—			(1,585		)
Ending balance at September 30, 2018	1	464	650		$72,648		$14,109		$—		$—		($76,800	)		($513	)		($3,885	)		$5,559

The accompanying notes are an integral part of these condensed consolidated financial statements.

Freddie Mac Form 10-Q 57

Financial Statements Condensed Consolidated Statements of Cash Flows

FREDDIE MAC

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In millions)	YTD 2019			YTD 2018
Net cash provided by (used in) operating activities		$3,404			$2,895
Cash flows from investing activities
Purchases of trading securities	(76,091		)	(101,700		)
Proceeds from sales of trading securities	61,398			94,934
Proceeds from maturities and repayments of trading securities	10,733			5,276
Purchases of available-for-sale securities	(6,440		)	(14,308		)
Proceeds from sales of available-for-sale securities	9,407			16,976
Proceeds from maturities and repayments of available-for-sale securities	3,201			4,740
Purchases of held-for-investment mortgage loans	(154,441		)	(113,083		)
Proceeds from sales of mortgage loans held-for-investment	11,063			7,121
Repayments of mortgage loans held-for-investment	232,374			190,264
Advances under secured lending arrangements	(34,627		)	(19,407		)
Repayments of secured lending arrangements	1,022			—
Net proceeds from dispositions of real estate owned and other recoveries	891			1,054
Net (increase) decrease in securities purchased under agreements to resell	(16,416		)	7,363
Derivative premiums and terminations, swap collateral, and exchange settlement payments, net	(10,536		)	5,418
Other, net	(424		)	(321		)
Net cash provided by (used in) investing activities	31,114			84,327
Cash flows from financing activities
Proceeds from issuance of debt securities of consolidated trusts held by third parties	178,248			158,825
Repayments and redemptions of debt securities of consolidated trusts held by third parties	(234,410		)	(211,729		)
Proceeds from issuance of other debt	631,628			444,809
Repayments of other debt	(605,323		)	(480,625		)
Increase in liquidation preference of senior preferred stock	—			312
Payment of cash dividends on senior preferred stock	(3,142		)	(1,585		)
Other, net	(84		)	(2		)
Net cash provided by (used in) financing activities	(33,083		)	(89,995		)
Net increase (decrease) in cash and cash equivalents (includes restricted cash and cash equivalents)	1,435			(2,773		)
Cash and cash equivalents (includes restricted cash and cash equivalents) at beginning of year	7,273			9,811
Cash and cash equivalents (includes restricted cash and cash equivalents) at end of period		$8,708			$7,038
Supplemental cash flow information
Cash paid for:
Debt interest		$52,720			$48,915
Income taxes	306			2,125
Non-cash investing and financing activities (Note 4)

The accompanying notes are an integral part of these condensed consolidated financial statements.

Freddie Mac Form 10-Q 58

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 1

Notes to Condensed Consolidated Financial Statements

NOTE 1

Summary of Significant Accounting Policies

Freddie Mac is a GSE chartered by Congress in 1970. Our public mission is to provide liquidity, stability, and affordability to the U.S. housing market. We are regulated by FHFA, the SEC, HUD, and Treasury, and are currently operating under the conservatorship of FHFA. For more information on the roles of FHFA and Treasury, see Note 2 in this Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2018, or 2018 Annual Report. Throughout our unaudited condensed consolidated financial statements and related notes, we use certain acronyms and terms which are defined in the Glossary of our 2018 Annual Report. Throughout this Form 10-Q, we refer to the three months ended September 30, 2019, the three months ended June 30, 2019, the three months ended March 31, 2019, the three months ended December 31, 2018, the three months ended September 30, 2018, the three months ended June 30, 2018, the three months ended March 31, 2018, and the three months ended December 31, 2017 as "3Q 2019," "2Q 2019," "1Q 2019," "4Q 2018," "3Q 2018," "2Q 2018," "1Q 2018," and "4Q 2017," respectively. We refer to the nine months ended September 30, 2019 and the nine months ended September 30, 2018 as "YTD 2019" and "YTD 2018," respectively.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes in our 2018 Annual Report.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and include our accounts as well as the accounts of other entities in which we have a controlling financial interest. All intercompany balances and transactions have been eliminated.

We are operating under the basis that we will realize assets and satisfy liabilities in the normal course of business as a going concern and in accordance with the authority provided by FHFA to our Board of Directors to oversee management's conduct of our business operations. Certain amounts in prior periods' condensed consolidated financial statements have been reclassified to conform to the current presentation. In the opinion of management, our unaudited condensed consolidated financial statements contain all adjustments, which include only normal recurring adjustments, necessary for a fair statement of our results.

We evaluate the materiality of identified errors in the financial statements using both an income statement, or "rollover," and a balance sheet, or "iron curtain," approach, based on relevant quantitative and qualitative factors. Net income includes certain adjustments to correct immaterial errors related to previously reported periods.

Freddie Mac Form 10-Q 59

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 1

Use of Estimates

The preparation of financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, gains, and losses during the reporting period. Management has made significant estimates in preparing the financial statements for establishing the allowance for credit losses and valuing financial instruments and other assets and liabilities. Actual results could be different from these estimates.

Recently Issued Accounting Guidance

Recently Adopted Accounting Guidance
Standard	Description	Date of Adoption	Effect on Condensed Consolidated Financial Statements
ASU 2016-02, Leases (Topic 842)	The amendment in this Update addresses the accounting for lease arrangements.	January 1, 2019	The adoption of the amendment did not have a material effect on our condensed consolidated financial statements or on our disclosures.
ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes	The amendments in this Update permit the OIS rate based on SOFR, as an eligible U.S. benchmark interest rate for purposes of applying hedge accounting under Topic 815.	January 1, 2019	The adoption of the amendment did not have a material effect on our condensed consolidated financial statements or on our disclosures.
ASU 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors	The amendments in this Update address certain ASU 2016-02 implementation issues including the recognition of taxes collected from lessees, lessor costs paid directly by a lessee, and recognition of variable payments for contracts with lease and non-lease components.	January 1, 2019	The adoption of the amendments did not have a material effect on our condensed consolidated financial statements or on our disclosures.

Freddie Mac Form 10-Q 60

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 1

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Condensed Consolidated Financial Statements
Standard	Description	Date of Planned Adoption	Effect on Consolidated Financial Statements
ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this Update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects lifetime expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.	January 1, 2020	We have developed our models to estimate lifetime expected credit losses on our financial instruments measured at amortized cost primarily using a discounted cash flow methodology. We are using these models to execute our process for estimating the allowance for credit losses under the new standard in parallel with our existing process for estimating the allowance for credit losses under current GAAP and are developing an appropriate governance process for our estimate of expected credit losses under the new standard. The amendments will be applied through a cumulative effect adjustment to retained earnings as of the beginning of the year of adoption. While we continue to evaluate the effect that ASU 2016-13, Financial Instruments - Credit Losses, and related amendments will have on our consolidated financial statements, we expect the transition impact to result in an immaterial change in retained earnings. The increase in the allowance for credit losses from incorporating lifetime losses is generally offset by recoveries and a positive impact from including forecasts of economic conditions. The actual impact at adoption will depend upon the nature and characteristics of the portfolio at the adoption date, as well as macroeconomic conditions and forecasts at that time.
ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement	The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurements, based on the concepts in the Concepts Statement, including the consideration of costs and benefits. Certain disclosure requirements were either removed, modified, or added.	January 1, 2020	On October 1, 2018, we early adopted the amendments to remove or modify certain disclosures, which did not have a material effect on our consolidated financial statements. We are delaying adoption of the amendments to add certain disclosures until their effective date. We do not expect that the adoption of the additional disclosures will have a material effect on our consolidated financial statements.
ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract	The amendments in this Update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.
ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities	The amendments in this Update require that indirect interests held through related parties under common control be considered on a proportional basis when determining whether fees paid to decision makers or service providers are variable interests. These amendments align with the determination of whether a reporting entity within a related party group is the primary beneficiary of a VIE.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

Freddie Mac Form 10-Q 61

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 1

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Condensed Consolidated Financial Statements
Standard	Description	Date of Planned Adoption	Effect on Consolidated Financial Statements
ASU 2019-01, Leases (Topic 842): Narrow-Scope Improvements for Lessors	The amendments in this Update provide guidance for the: (1) lessor's fair value determination of the lease's underlying asset; (2) lessor's statement of cash flows presentation of cash received from sales-type and direct financing leases; and (3) removal of interim transition disclosure requirements related to changes in accounting principles.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.
ASU 2019-04, Codification Improvements to Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Financial Instruments (Topic 825)	The amendments in this Update clarify certain aspects of Topic 326 guidance issued in ASU 2016-13 including the scope of the credit losses standard and issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayments. The other amendments in this update clarify certain aspects of Topic 815 and Topic 825.	January 1, 2020	We are assessing the impact of adopting the Topic 326 amendments as part of our assessment of the adoption impact of ASU 2016-13, Financial Instruments-Credit Losses.  We do not expect that the adoption of the Topic 815 and Topic 825 amendments will have a material effect on our consolidated financial statements.
ASU 2019-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this Update provides entities with transition relief upon the adoption of ASU 2016-13 by providing an option to elect fair value option on certain financial instruments measured at amortized cost.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

Freddie Mac Form 10-Q 62

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 2

NOTE 2

Conservatorship and Related Matters

Business Objectives

We operate under the conservatorship that commenced on September 6, 2008, conducting our business under the direction of FHFA, as our Conservator. The conservatorship and related matters significantly affect our management, business activities, financial condition, and results of operations. Upon its appointment, FHFA, as Conservator, immediately succeeded to all rights, titles, powers, and privileges of Freddie Mac, and of any stockholder, officer, or director thereof, with respect to the company and its assets. The Conservator also succeeded to the title to all books, records, and assets of Freddie Mac held by any other legal custodian or third party. The Conservator provided for the Board of Directors to perform certain functions and to oversee management, and the Board delegated to management authority to conduct business operations so that the company can continue to operate in the ordinary course. The directors serve on behalf of, and perform such functions as provided by, the Conservator.

We are subject to certain constraints on our business activities under the Purchase Agreement. However, the support provided by Treasury pursuant to the Purchase Agreement currently enables us to maintain our access to the debt markets and to have adequate liquidity to conduct our normal business activities, although the costs of our debt funding could vary. Our ability to access funds from Treasury under the Purchase Agreement is critical to keeping us solvent.

Purchase Agreement

Treasury, as the holder of the senior preferred stock, is entitled to receive quarterly cash dividends, when, as, and if declared by our Board of Directors. The dividends we have paid to Treasury on the senior preferred stock have been declared by, and paid at the direction of, the Conservator, acting as successor to the rights, titles, powers, and privileges of the Board.

Under the August 2012 amendment to the Purchase Agreement, for each quarter from January 1, 2013 and thereafter, the dividend payment will be the amount, if any, by which our Net Worth Amount at the end of the immediately preceding fiscal quarter, less the applicable Capital Reserve Amount, exceeds zero. Pursuant to the September 2019 Letter Agreement, the applicable Capital Reserve Amount is $20.0 billion. If for any reason we do not pay the net worth sweep dividend in full for any period, the applicable Capital Reserve Amount will thereafter be zero.

In addition, pursuant to the September 2019 Letter Agreement, the liquidation preference of the senior preferred stock will be increased, at the end of each fiscal quarter, beginning on September 30, 2019, by an amount equal to the increase in the Net Worth Amount, if any, during the immediately prior fiscal quarter, until the liquidation preference has increased by $17.0 billion. As a result, the liquidation preference of the senior preferred stock increased from $75.6 billion to $77.5 billion on September 30, 2019 based on the $1.8 billion increase in our Net Worth Amount during 2Q 2019, and will increase to $79.3 billion on December 31, 2019 based on the $1.8 billion increase in our Net Worth Amount during 3Q 2019.

Under the September 2019 Letter Agreement, Freddie Mac and Treasury also agreed to negotiate and execute an amendment to the Purchase Agreement that further enhances taxpayer protections by adopting covenants broadly consistent with recommendations for administrative reform contained in the Treasury's September 2019 Housing Reform Plan.

Impact of Conservatorship and Related Developments on the Mortgage-Related Investments Portfolio

In February 2019, FHFA directed us to maintain the UPB of our mortgage-related investments portfolio at or below $225 billion at all times. The UPB of this portfolio was $221.6 billion at September 30, 2019. Our ability to acquire and sell mortgage assets continues to be significantly constrained by limitations imposed by the Purchase Agreement and FHFA.

Government Support for Our Business

We receive substantial support from Treasury and are dependent upon its continued support to continue operating our business. Our ability to access funds from Treasury under the Purchase Agreement is critical to:

n Keeping us solvent;

n Allowing us to focus on our primary business objectives under conservatorship; and

n Avoiding the appointment of a receiver by FHFA under statutory mandatory receivership provisions.

Freddie Mac Form 10-Q 63

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 2

At June 30, 2019, our assets exceeded our liabilities under GAAP; therefore, FHFA, as Conservator, did not request a draw on our behalf and, as a result, we did not receive any funding from Treasury under the Purchase Agreement during 3Q 2019. The amount of available funding remaining under the Purchase Agreement is $140.2 billion and will be reduced by any future draws.

See Note 8 and Note 11 for more information on the conservatorship and the Purchase Agreement.

Related Parties As a Result of Conservatorship

We are deemed related parties with Fannie Mae as both we and Fannie Mae have the same relationships with FHFA and Treasury. CSS was formed in 2013 as a limited liability company equally-owned by Freddie Mac and Fannie Mae and is also deemed a related party. In connection with the formation of CSS, we entered into a limited liability company agreement with Fannie Mae. We and Fannie Mae have each appointed two executives to the CSS Board of Managers and signed governance and operating agreements for CSS, including an updated customer services agreement with Fannie Mae and CSS in May of 2019. In June of 2019, we entered into an agreement with Fannie Mae regarding the commingling of certain of our mortgage securities under the Single Security Initiative and related indemnification obligations. During YTD 2019, we contributed $84 million of capital to CSS, and we have contributed $548 million since the fourth quarter of 2014.

Freddie Mac Form 10-Q 64

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

NOTE 3

Securitization Activities and Consolidation

Our primary business activities in our Single-family Guarantee and Multifamily segments involve the securitization of loans or other mortgage-related assets using trusts that are VIEs. These trusts issue beneficial interests in the loans or other mortgage-related assets that they own. We guarantee the principal and interest payments on some or all of the issued beneficial interests in substantially all of our securitization transactions. We consolidate VIEs when we have a controlling financial interest in the VIE and are therefore considered the primary beneficiary of the VIE. See Note 5 for additional information on our guarantee activities.

Consolidated VIEs

The table below presents the carrying value and classification of the assets and liabilities of consolidated VIEs on our condensed consolidated balance sheets.

Table 3.1 - Consolidated VIEs

(In millions)	As of September 30, 2019		As of December 31, 2018
Condensed Consolidated Balance Sheet Line Item
Assets:
Cash and cash equivalents (includes $3,494 and $566 of restricted cash and cash equivalents)		$3,495		$567
Securities purchased under agreements to resell	21,400		12,125
Investments in securities, at fair value	766		—
Mortgage loans held-for-investment	1,905,633		1,842,850
Accrued interest receivable	6,109		5,914
Other assets	12,093		1,631
Total assets of consolidated VIEs		$1,949,496		$1,863,087
Liabilities:
Accrued interest payable		$5,519		$5,335
Debt, net	1,869,308		1,792,677
Total liabilities of consolidated VIEs		$1,874,827		$1,798,012

Non-Consolidated VIEs

Our involvement with VIEs for which we are not the primary beneficiary takes one or both of two forms - purchasing an investment in these entities or providing a guarantee to these entities. As part of the Single Security Initiative, we have the ability to commingle TBA-eligible Fannie Mae collateral in certain of our resecuritization products that we do not consolidate. We extend our guarantee of these products to cover principal and interest that are payable from the underlying Fannie Mae collateral. See Note 5 for additional information on our guarantee of Fannie Mae securities.

The following table presents the carrying amounts and classification of the assets and liabilities recorded on our condensed consolidated balance sheets related to non-consolidated VIEs with which we were involved in the design and creation and have a significant continuing involvement, as well as our maximum exposure to loss and total assets of the VIEs. Our maximum exposure to loss includes the guaranteed UPB of assets held by the non-consolidated VIEs, the UPB of unguaranteed securities that we acquired from these securitization transactions, and the UPB of guarantor advances made to the holders of the guaranteed securities. Our maximum exposure to loss and total assets of non-consolidated VIEs excludes our investments in and obligations to non-consolidated Freddie Mac resecuritization trusts because we already consolidate the underlying Freddie Mac collateral of these trusts on our condensed consolidated balance sheets and for commingled resecuritization trusts, we view the likelihood of being required to perform on our guarantee of the underlying Fannie Mae collateral as remote. Our maximum exposure to loss also excludes our interest rate exposure on certain securitization activity and other mortgage-related guarantees measured at fair value where our interest rate exposure may be unlimited. We generally reduce our exposure to these guarantees with unlimited interest rate exposure through separate contracts with third parties.

We do not believe the maximum exposure to loss disclosed in the table below is representative of the actual loss we are likely to incur, based on our historical loss experience and after consideration of proceeds from related collateral liquidation, including possible recoveries under credit enhancement arrangements. See Note 6 for additional information on credit enhancement arrangements.

Freddie Mac Form 10-Q 65

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 3

Table 3.2 - Non-Consolidated VIEs

(In millions)	As of September 30, 2019		As of December 31, 2018
Assets and Liabilities Recorded on our Condensed Consolidated Balance Sheets(1)
Assets:
Investments in securities, at fair value		$39,091		$44,020
Accrued interest receivable	214		235
Derivative assets, net	12		1
Other assets	3,737		3,119
Liabilities:
Derivative liabilities, net	89		88
Other liabilities	3,511		3,049
Maximum Exposure to Loss	268,269		241,055
Total Assets of Non-Consolidated VIEs	320,221		284,724

(1) Includes our variable interests in REMICs and Strips, commingled Supers, K Certificates, SB Certificates, certain senior subordinate securitization structures, other securitization products, and other risk transfer securitizations that we do not consolidate.

We also obtain interests in various other VIEs created by third parties through the normal course of business. To the extent that we were not involved in the design and creation of these VIEs, they are excluded from the table above. Our interests in these VIEs are generally passive in nature and are not expected to result in us obtaining a controlling financial interest in these VIEs in the future.

Freddie Mac Form 10-Q 66

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

NOTE 4

Mortgage Loans and Allowance for Credit Losses

The table below provides details of the loans on our condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018.

Table 4.1 - Mortgage Loans

	September 30, 2019									December 31, 2018
(In millions)	Held by Freddie Mac			Held by Consolidated Trusts			Total			Held by Freddie Mac			Held by Consolidated Trusts			Total
Held-for-sale:
Single-family		$17,249			$—			$17,249			$20,946			$—			$20,946
Multifamily	25,397			—			25,397			23,959			—			23,959
Total UPB	42,646			—			42,646			44,905			—			44,905
Cost basis and fair value adjustments, net	(1,528		)	—			(1,528		)	(3,283		)	—			(3,283		)
Total held-for-sale loans, net	41,118			—			41,118			41,622			—			41,622
Held-for-investment:
Single-family	41,886			1,867,906			1,909,792			35,885			1,814,008			1,849,893
Multifamily	11,291			5,591			16,882			10,828			4,220			15,048
Total UPB	53,177			1,873,497			1,926,674			46,713			1,818,228			1,864,941
Cost basis adjustments	(421		)	34,973			34,552			(1,198		)	27,752			26,554
Allowance for loan losses	(2,017		)	(2,837		)	(4,854		)	(3,009		)	(3,130		)	(6,139		)
Total held-for-investment loans, net	50,739			1,905,633			1,956,372			42,506			1,842,850			1,885,356
Total mortgage loans, net		$91,857			$1,905,633			$1,997,490			$84,128			$1,842,850			$1,926,978

The table below provides details of the UPB of loans we purchased, reclassified from held-for-investment to held-for-sale, and sold.

Table 4.2 - Loans Purchased, Reclassified from Held-for-Investment to Held-for-Sale, and Sold

(In billions)	3Q 2019		3Q 2018		YTD 2019		YTD 2018
Single-family:
Purchases
Held-for-investment loans		$133.8		$81.6		$305.0		$231.5
Reclassified from held-for-investment to held-for-sale (1)	3.0		13.3		8.1		17.6
Sale of held-for-sale loans(2)	3.7		2.3		9.4		6.5
Multifamily:
Purchases
Held-for-investment loans	4.4		0.9		6.8		2.6
Held-for-sale loans	23.1		16.3		50.6		42.5
Reclassified from held-for-investment to held-for-sale (1)	0.4		0.2		1.2		0.7
Sale of held-for-sale loans (3)	19.7		14.4		49.5		44.8

(1) We reclassify loans from held-for-investment to held-for-sale when we no longer have the intent or ability to hold for the foreseeable future. For additional information regarding the fair value of our loans classified as held-for-sale, see Note 15.

(2) Our sales of single-family loans reflect the sale of seasoned single-family mortgage loans. The sale of seasoned single-family mortgage loans is part of our strategy to mitigate and reduce our holdings of less liquid assets.

(3) Our sales of multifamily loans occur primarily through the issuance of multifamily K Certificates and SB Certificates.

Freddie Mac Form 10-Q 67

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Credit Quality

Single-Family

The current LTV ratio is one key factor we consider when estimating our allowance for credit losses for single-family loans. As current LTV ratios increase, the borrower's equity in the home decreases, which may negatively affect the borrower's ability to refinance (outside of the Enhanced Relief Refinance program) or to sell the property for an amount at or above the balance of the outstanding loan.

A second-lien loan also reduces the borrower's equity in the home, and has a similar negative effect on the borrower's ability to refinance or sell the property for an amount at or above the combined balances of the first and second loans. However, borrowers are free to obtain second-lien financing after origination, and we are not entitled to receive notification when a borrower does so. For further information about concentrations of risk associated with our single-family and multifamily loans, see Note 14.

The table below presents the recorded investment of single-family held-for-investment loans by current LTV ratios. Our current LTV ratios are estimates based on available data through the end of each respective period presented.

Table 4.3 - Recorded Investment of Single-Family Held-for-Investment Loans by Current LTV Ratios

	September 30, 2019								December 31, 2018
	Current LTV Ratio						Total		Current LTV Ratio						Total
(In millions)	≤ 80		> 80 to 100		> 100(1)				≤ 80		> 80 to 100		> 100(1)
20- and 30-year or more, amortizing fixed-rate		$1,388,311		$255,880		$4,689		$1,648,880		$1,336,310		$214,703		$6,654		$1,557,667
15-year amortizing fixed-rate	235,185		5,604		103		240,892		251,152		4,522		157		255,831
Adjustable-rate	37,659		1,660		6		39,325		42,117		1,883		7		44,007
Alt-A, interest-only, and option ARM	13,743		1,198		289		15,230		16,498		1,903		559		18,960
Total single-family loans		$1,674,898		$264,342		$5,087		$1,944,327		$1,646,077		$223,011		$7,377		$1,876,465

(1) The serious delinquency rate for the total of single-family held-for-investment mortgage loans with current LTV ratios in excess of 100% was 5.18% and 7.24% as of September 30, 2019 and December 31, 2018, respectively.

For reporting purposes:

n Loans within the Alt-A category continue to be presented in that category following modification, even though the borrower may have provided full documentation of assets and income to complete the modification and

n Loans within the option ARM category continue to be presented in that category following modification, even though the modified loan no longer provides for optional payment provisions.

Multifamily

The table below presents the recorded investment in our multifamily held-for-investment loans, by credit quality indicator based on available data through the end of each period presented. These indicators involve significant management judgment.

Table 4.4 - Recorded Investment of Multifamily Held-for-Investment Loans by Credit Quality Indicator

(In millions)	September 30, 2019		December 31, 2018
Credit risk profile by internally assigned grade:(1)
Pass		$16,684		$14,648
Special mention	66		201
Substandard	149		181
Doubtful	—		—
Total		$16,899		$15,030

(1) A loan categorized as: "Pass" is current and adequately protected by the current financial strength and debt service capacity of the borrower; "Special mention" has administrative issues that may affect future repayment prospects but does not have current credit weaknesses; "Substandard" has a weakness that jeopardizes the timely full repayment; and "Doubtful" has a weakness that makes collection or liquidation in full highly questionable and improbable based on existing conditions.

Freddie Mac Form 10-Q 68

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Mortgage Loan Performance

The tables below present the recorded investment of our single-family and multifamily loans, held-for-investment, by payment status.

Table 4.5 - Recorded Investment of Held-for-Investment Loans by Payment Status

	September 30, 2019
(In millions)	Current		One Month Past Due		Two Months Past Due		Three Months or More Past Due, or in Foreclosure(1)		Total		Non-accrual
Single-family:
20- and 30-year or more, amortizing fixed-rate		$1,624,964		$14,846		$3,495		$5,575		$1,648,880		$5,573
15-year amortizing fixed-rate	239,460		1,025		170		237		240,892		237
Adjustable-rate	38,928		249		53		95		39,325		95
Alt-A, interest-only, and option ARM	13,855		608		228		539		15,230		538
Total single-family	1,917,207		16,728		3,946		6,446		1,944,327		6,443
Total multifamily	16,896		3		—		—		16,899		13
Total single-family and multifamily		$1,934,103		$16,731		$3,946		$6,446		$1,961,226		$6,456
	December 31, 2018
(In millions)	Current		One Month Past Due		Two Months Past Due		Three Months or More Past Due, or in Foreclosure(1)		Total		Non-accrual
Single-family:
20- and 30-year or more, amortizing fixed-rate		$1,532,499		$14,683		$3,602		$6,883		$1,557,667		$6,881
15-year amortizing fixed-rate	254,376		1,021		171		263		255,831		263
Adjustable-rate	43,549		287		58		113		44,007		113
Alt-A, interest-only, and option ARM	16,975		793		327		865		18,960		864
Total single-family	1,847,399		16,784		4,158		8,124		1,876,465		8,121
Total multifamily	15,030		—		—		—		15,030		17
Total single-family and multifamily		$1,862,429		$16,784		$4,158		$8,124		$1,891,495		$8,138

(1) Includes $1.9 billion and $2.9 billion of single-family loans that were in the process of foreclosure as of September 30, 2019 and December 31, 2018, respectively.

Freddie Mac Form 10-Q 69

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

The table below summarizes the delinquency rates of loans within our single-family credit guarantee and multifamily mortgage portfolios.

Table 4.6 - Delinquency Rates

(Dollars in millions)	September 30, 2019			December 31, 2018
Single-family:
Non-credit-enhanced portfolio
Serious delinquency rate	0.72		%	0.83		%
Total number of seriously delinquent loans	42,758			51,197
Credit-enhanced portfolio:(1)
Primary mortgage insurance:
Serious delinquency rate	0.76		%	0.86		%
Total number of seriously delinquent loans	14,358			15,287
Other credit protection:(2)
Serious delinquency rate	0.34		%	0.31		%
Total number of seriously delinquent loans	15,736			12,920
Total single-family:
Serious delinquency rate	0.61		%	0.69		%
Total number of seriously delinquent loans	67,991			75,649
Multifamily: (3)
Non-credit-enhanced portfolio:
Delinquency rate	0.01		%	—		%
UPB of delinquent loans		$3			$2
Credit-enhanced portfolio:
Delinquency rate	0.04		%	0.01		%
UPB of delinquent loans		$103			$28
Total multifamily:
Delinquency rate	0.04		%	0.01		%
UPB of delinquent loans		$106			$30

(1) The credit-enhanced categories are not mutually exclusive, as a single loan may be covered by both primary mortgage insurance and other credit protection.

(2) Consists of single-family loans covered by financial arrangements (other than primary mortgage insurance) that are designed to reduce our credit risk exposure. See Note 6 for additional information on our credit enhancements.

(3) Multifamily delinquency performance is based on the UPB of loans that are two monthly payments or more past due or those in the process of foreclosure.

Allowance for Credit Losses

The allowance for credit losses represents estimates of probable incurred credit losses which we recognize by recording a charge to the provision for credit losses on our condensed consolidated statements of comprehensive income. The allowance for credit losses includes:

n Our allowance for loan losses, which pertains to all single-family and multifamily loans classified as held-for-investment on our condensed consolidated balance sheets and

n Our reserve for guarantee losses, which pertains to single-family and multifamily loans underlying our senior subordinate securitization structures (non-consolidated), other securitization products, and other mortgage-related guarantees.

Freddie Mac Form 10-Q 70

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Table 4.7 - Details of Allowance for Credit Losses

The table below summarizes changes in our allowance for credit losses.

	3Q 2019												3Q 2018
	Allowance for Loan Losses						Reserve  for Guarantee Losses			Total			Allowance for Loan Losses						Reserve  for Guarantee Losses			Total
(In millions)	Held by Freddie Mac			Held By Consolidated Trusts									Held by Freddie Mac			Held By Consolidated Trusts
Single-family:
Beginning balance		$2,238			$3,042			$46			$5,326			$4,887			$3,497			$49			$8,433
Provision (benefit) for credit losses	(84		)	(97		)	1			(180		)	(522		)	143			1			(378		)
Charge-offs	(394		)	(12		)	(1		)	(407		)	(1,262		)	(13		)	(2		)	(1,277		)
Recoveries	104			3			—			107			117			2			—			119
Transfers, net (1)	103			(103		)	—			—			306			(306		)	—			—
Other (2)	41			—			—			41			76			11			—			87
Single-family ending balance	2,008			2,833			46			4,887			3,602			3,334			48			6,984
Multifamily ending balance	9			4			5			18			8			2			8			18
Total ending balance		$2,017			$2,837			$51			$4,905			$3,610			$3,336			$56			$7,002

	YTD 2019												YTD 2018
	Allowance for Loan Losses						Reserve  for Guarantee Losses			Total			Allowance for Loan Losses						Reserve  for Guarantee Losses			Total
(In millions)	Held by Freddie Mac			Held By Consolidated Trusts									Held by Freddie Mac			Held By Consolidated Trusts
Single-family:
Beginning balance		$3,003			$3,127			$46			$6,176			$5,251			$3,680			$48			$8,979
Provision (benefit) for credit losses	(509		)	29			3			(477		)	(629		)	266			6			(357		)
Charge-offs	(1,208		)	(45		)	(3		)	(1,256		)	(2,198		)	(44		)	(6		)	(2,248		)
Recoveries	331			10			—			341			336			5			—			341
Transfers, net (1)	291			(291		)	—			—			597			(597		)	—			—
Other (2)	100			3			—			103			245			24			—			269
Single-family ending balance	2,008			2,833			46			4,887			3,602			3,334			48			6,984
Multifamily ending balance	9			4			5			18			8			2			8			18
Total ending balance		$2,017			$2,837			$51			$4,905			$3,610			$3,336			$56			$7,002

(1) Relates to removal of delinquent loans from consolidated trusts and resecuritization after such removal. 

(2) Primarily includes capitalization of past due interest on modified loans.

A significant number of unsecuritized single-family loans on our condensed consolidated balance sheets are individually evaluated for impairment while substantially all single-family loans held by our consolidated trusts are collectively evaluated for impairment. The allowance for loan losses associated with our held-for-investment unsecuritized loans represented approximately 3.8% and 6.6% of the recorded investment in such loans at September 30, 2019 and December 31, 2018, respectively, and a substantial portion of the allowance associated with these loans represented interest rate concessions provided to borrowers as part of loan modifications. The allowance for loan losses associated with loans held by our consolidated trusts represented approximately 0.1% and 0.2% of the recorded investment in such loans as of September 30, 2019 and December 31, 2018, respectively.

The table below presents our allowance for loan losses and our recorded investment in loans, held-for-investment, by impairment evaluation methodology.

Table 4.8 - Net Investment in Loans

	September 30, 2019									December 31, 2018
(In millions)	Single-family			Multifamily			Total			Single-family			Multifamily			Total
Recorded investment:
Collectively evaluated		$1,904,203			$16,818			$1,921,021			$1,830,044			$14,945			$1,844,989
Individually evaluated	40,124			81			40,205			46,421			85			46,506
Total recorded investment	1,944,327			16,899			1,961,226			1,876,465			15,030			1,891,495
Ending balance of the allowance for loan losses:
Collectively evaluated	(1,515		)	(13		)	(1,528		)	(1,761		)	(9		)	(1,770		)
Individually evaluated	(3,326		)	—			(3,326		)	(4,369		)	—			(4,369		)
Total ending balance of the allowance	(4,841		)	(13		)	(4,854		)	(6,130		)	(9		)	(6,139		)
Net investment in loans		$1,939,486			$16,886			$1,956,372			$1,870,335			$15,021			$1,885,356

Freddie Mac Form 10-Q 71

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Allowance for Loan Losses Determined on an Individual Basis

Impaired Loans

The tables below present the UPB, recorded investment, related allowance for loan losses, average recorded investment, and interest income recognized for individually impaired loans.

Table 4.9 - Individually Impaired Loans

	September 30, 2019							December 31, 2018
(In millions)	UPB		Recorded Investment		Associated Allowance			UPB		Recorded Investment		Associated Allowance
Single-family:
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$3,008		$2,390	N/A				$3,335		$2,666	N/A
15-year amortizing fixed-rate	20		20		N/A			23		22		N/A
Adjustable-rate	183		182		N/A			227		226		N/A
Alt-A, interest-only, and option ARM	1,004		853		N/A			1,286		1,083		N/A
Total with no allowance recorded	4,215		3,445		N/A			4,871		3,997		N/A
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	32,441		32,118			($2,784	)	37,579		36,959			($3,660	)
15-year amortizing fixed-rate	641		650		(14		)	703		713		(19		)
Adjustable-rate	133		132		(7		)	164		162		(8		)
Alt-A, interest-only, and option ARM	3,962		3,779		(521		)	4,867		4,590		(682		)
Total with an allowance recorded	37,177		36,679		(3,326		)	43,313		42,424		(4,369		)
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	35,449		34,508		(2,784		)	40,914		39,625		(3,660		)
15-year amortizing fixed-rate	661		670		(14		)	726		735		(19		)
Adjustable-rate	316		314		(7		)	391		388		(8		)
Alt-A, interest-only, and option ARM	4,966		4,632		(521		)	6,153		5,673		(682		)
Total single-family	41,392		40,124		(3,326		)	48,184		46,421		(4,369		)
Multifamily:
With no allowance recorded (1)	87		81		N/A			89		82		N/A
With an allowance recorded	—		—		—			3		3		—
Total multifamily	87		81		—			92		85		—
Total single-family and multifamily		$41,479		$40,205		($3,326	)		$48,276		$46,506		($4,369	)

Referenced footnotes are included after the last table in the Impaired Loans section.

Freddie Mac Form 10-Q 72

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

	3Q 2019						3Q 2018
(In millions)	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)
Single-family:
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$2,450		$59		$1		$3,142		$83		$3
15-year amortizing fixed-rate	19		1		—		20		—		—
Adjustable rate	191		3		—		238		3		—
Alt-A, interest-only, and option ARM	880		16		—		1,159		21		1
Total with no allowance recorded	3,540		79		1		4,559		107		4
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	32,618		412		47		42,393		520		52
15-year amortizing fixed-rate	641		5		1		740		7		2
Adjustable rate	129		2		—		183		2		—
Alt-A, interest-only, and option ARM	3,866		55		9		5,622		72		7
Total with an allowance recorded	37,254		474		57		48,938		601		61
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	35,068		471		48		45,535		603		55
15-year amortizing fixed-rate	660		6		1		760		7		2
Adjustable rate	320		5		—		421		5		—
Alt-A, interest-only, and option ARM	4,746		71		9		6,781		93		8
Total single-family	40,794		553		58		53,497		708		65
Multifamily:
With no allowance recorded (1)	81		1		1		112		2		1
With an allowance recorded	—		—		—		3		—		—
Total multifamily	81		1		1		115		2		1
Total single-family and multifamily		$40,875		$554		$59		$53,612		$710		$66

Referenced footnotes are included after the last table in the Impaired Loans section

	YTD 2019						YTD 2018
(In millions)	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)
Single-family —
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$2,573		$207		$6		$3,399		$268		$13
15-year amortizing fixed-rate	20		1		—		21		3		—
Adjustable rate	209		9		—		255		9		—
Alt-A, interest-only, and option ARM	932		52		1		1,319		68		3
Total with no allowance recorded	3,734		269		7		4,994		348		16
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	34,051		1,394		138		46,140		1,621		217
15-year amortizing fixed-rate	665		17		3		830		21		8
Adjustable rate	139		5		1		210		4		2
Alt-A, interest-only, and option ARM	4,097		180		18		6,357		205		24
Total with an allowance recorded	38,952		1,596		160		53,537		1,851		251
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	36,624		1,601		144		49,539		1,889		230
15-year amortizing fixed-rate	685		18		3		851		24		8
Adjustable rate	348		14		1		465		13		2
Alt-A, interest-only, and option ARM	5,029		232		19		7,676		273		27
Total single-family	42,686		1,865		167		58,531		2,199		267
Multifamily:
With no allowance recorded (1)	83		3		1		132		5		2
With an allowance recorded	—		—		—		3		—		—
Total multifamily	83		3		1		135		5		2
Total single-family and multifamily		$42,769		$1,868		$168		$58,666		$2,204		$269

(1) Individually impaired loans with no allowance primarily represent those loans for which the collateral value is sufficiently in excess of the loan balance to result in recovery of the entire recorded investment if the property were foreclosed upon or otherwise subject to disposition.

(2) Consists primarily of loans classified as TDRs.

(3) Consists of income recognized during the period related to loans on non-accrual status.

Freddie Mac Form 10-Q 73

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Troubled Debt Restructurings (TDRs)

The table below presents the volume of single-family and multifamily loans that were newly classified as TDRs, based on the original product category of the loan before the loan was classified as a TDR. Loans classified as a TDR in one period may be subject to further action (such as a modification or remodification) in a subsequent period. In such cases, the subsequent action would not be reflected in the table below since the loan would already have been classified as a TDR.

Table 4.10 - TDR Activity

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(Dollars in millions)	Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment
Single-family: (1)
20- and 30-year or more, amortizing fixed-rate	5,908		$998	7,157		$1,091	19,668		$3,262	37,847		$6,159
15-year amortizing fixed-rate	693	69		909	83		2,364	230		5,194	514
Adjustable-rate	128	22		197	27		403	64		773	122
Alt-A, interest-only, and option ARM	285	45		414	65		1,331	190		2,294	379
Total single-family	7,014	1,134		8,677	1,266		23,766	3,746		46,108	7,174
Multifamily	—		$—	—		$—	—		$—	1		$15

(1) The pre-TDR recorded investment for single-family loans initially classified as TDR during 3Q 2019 and YTD 2019 was $1.1 billion and $3.7 billion, respectively, compared to $1.3 billion and $7.2 billion during 3Q 2018 and YTD 2018, respectively.

Of the single-family loan modifications that were classified as TDRs during 3Q 2019, 3Q 2018, YTD 2019 and YTD 2018, respectively:

n 9%, 9%, 8%, and 12% involved interest rate reductions and, in certain cases, term extensions;

n 23%, 21%, 24%, and 24% involved principal forbearance in addition to interest rate reductions and, in certain cases, term extensions;

n The average term extension was 188, 110, 177, and 126 months; and

n The average interest rate reduction was 0.2%, 0.2%, 0.1%, and 0.3%.

The table below presents the volume of our TDR modifications that experienced payment defaults (i.e., loans that became two months delinquent or completed a loss event) during the applicable periods and had completed a modification during the year preceding the payment default. The table presents loans based on their original product category before modification.

Table 4.11 - Payment Defaults of Completed TDR Modifications

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(Dollars in millions)	Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment
Single-family:
20- and 30-year or more, amortizing fixed-rate	3,256		$407	3,584		$512	10,533		$1,237	9,671		$1,435
15-year amortizing fixed-rate	96	9		116	10		329	24		435	36
Adjustable-rate	33	3		53	9		95	10		139	21
Alt-A, interest-only, and option ARM	178	24		302	55		687	96		827	154
Total single-family	3,563	443		4,055	586		11,644	1,367		11,072	1,646
Multifamily	—		$—	—		$—	—		$—	—		$—

In addition to modifications, loans may be classified as TDRs as a result of other loss mitigation activities (i.e., repayment plans, forbearance agreements, or trial period modifications). During YTD 2019 and YTD 2018, 3,983 and 6,487, respectively, of such loans (with a post-TDR recorded investment of $0.4 billion and $0.8 billion, respectively) experienced a payment default within a year after the loss mitigation activity occurred.

Freddie Mac Form 10-Q 74

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 4

Non-Cash Investing and Financing Activities

During YTD 2019 and YTD 2018, we acquired $162.7 billion and $122.6 billion, respectively, of loans held-for-investment in exchange for the issuance of debt securities of consolidated trusts in guarantor swap transactions. We received approximately $28.6 billion and $18.8 billion of loans from sellers in guarantor swap transactions and $1.6 billion and $0.1 billion of loans from sellers in cash execution transactions during YTD 2019 and YTD 2018, respectively, to satisfy advances to lenders that were recorded in other assets on our condensed consolidated balance sheets.

Freddie Mac Form 10-Q 75

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 5

NOTE 5

Guarantee Activities

We generate revenue through our guarantee activities by agreeing to absorb the credit risk associated with certain financial instruments that are owned or held by third parties. In exchange for providing this guarantee, we receive an ongoing guarantee fee that is commensurate with the risks assumed and that will, over the long-term, provide us with cash flows that are expected to exceed the credit-related and administrative expenses of the underlying financial instruments. The profitability of our guarantee activities may vary and will be dependent on our guarantee fee and the actual credit performance of the underlying financial instruments that we have guaranteed.

The table below shows our maximum exposure, recognized liability, and maximum remaining term of our recognized guarantees to non-consolidated VIEs and other third parties. This table does not include our unrecognized guarantees, such as guarantees to consolidated VIEs or to resecuritization trusts that do not expose us to incremental credit risk. The maximum exposure disclosed in the table is not representative of the actual loss we are likely to incur, based on our historical loss experience and after consideration of proceeds from related collateral liquidation, including possible recoveries under credit enhancement arrangements. See Note 6 for additional information on our credit enhancement arrangements.

As part of the Single Security Initiative, we have the ability to commingle TBA-eligible Fannie Mae collateral in certain of our resecuritization products. We extend our guarantee of these products to cover principal and interest that are payable from the underlying Fannie Mae collateral. Because both Freddie Mac and Fannie Mae are under the common control of FHFA, and due to Fannie Mae’s status as a GSE and the funding commitment available to it through its senior preferred stock purchase agreement with Treasury, we view the likelihood of being required to perform on our guarantee of Fannie Mae collateral as remote and do not charge an incremental guarantee fee to include Fannie Mae securities in our resecuritization products. Thus, we do not record a guarantee obligation with respect to Fannie Mae securities backing Freddie Mac resecuritization products, and we exclude from the following table approximately $17 billion of Fannie Mae securities backing Freddie Mac resecuritization products as of September 30, 2019.

Table 5.1 - Financial Guarantees

	September 30, 2019					December 31, 2018
(Dollars in millions, terms in years)	Maximum Exposure(1)		Recognized Liability(2)		Maximum Remaining Term	Maximum Exposure(1)		Recognized Liability(2)		Maximum Remaining Term
Single-family:
Securitization activity guarantees		$24,387		$317	40		$17,783		$220	40
Other mortgage-related guarantees	7,139		180		30	6,139		167		30
Total single-family		$31,526		$497			$23,922		$387
Multifamily:
Securitization activity guarantees		$241,853		$3,128	40		$221,245		$2,746	40
Other mortgage-related guarantees	10,122		430		35	9,779		428		35
Total multifamily		$251,975		$3,558			$231,024		$3,174
Other guarantees measured at fair value		$24,976		$183	30		$16,251		$242	30

(1) The maximum exposure represents the contractual amounts that could be lost if counterparties or borrowers defaulted, without consideration of possible recoveries under credit enhancement arrangements, such as recourse provisions, third-party insurance contracts, or from collateral held or pledged. For other guarantees measured at fair value, this amount represents the notional value if it relates to our market value guarantees or guarantees of third-party derivative instruments or the UPB if it relates to a guarantee of a mortgage-related asset. For certain of our other guarantees measured at fair value, our exposure may be unlimited. We generally reduce our exposure to these guarantees with unlimited exposure through separate contracts with third parties.

(2) For securitization activity guarantees and other mortgage-related guarantees, this amount represents the guarantee obligation on our condensed consolidated balance sheets. This amount excludes our reserve for guarantee losses, which totaled $51 million and $52 million as of September 30, 2019 and December 31, 2018, respectively, and is included within other liabilities on our condensed consolidated balance sheets. For other guarantees measured at fair value, this amount represents the fair value of the contract.

Freddie Mac Form 10-Q 76

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 6

NOTE 6

Credit Enhancements

In connection with many of our mortgage loans, securitization activity guarantees, other mortgage-related guarantees, and other credit risk transfer transactions, we obtain various forms of credit enhancements that reduce our exposure to credit losses. These credit enhancements may be associated with mortgage loans or guarantees recognized on our condensed consolidated balance sheets or embedded in debt instruments recognized on our condensed consolidated balance sheets.

Mortgage Loan Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to our mortgage loan credit enhancements. For information about counterparty credit risk associated with credit enhancement providers, see Note 14.

Table 6.1 - Mortgage Loan Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage		Total Current and Protected UPB(1)		Maximum Coverage
Single-family:
Primary mortgage insurance		$410,999		$105,171		$378,594		$96,996
ACIS transactions(2)	869,148		10,081		807,885		9,123
STACR Trust transactions	280,889		9,154		161,152		5,026
Other	28,347		6,070		18,136		5,389
Total mortgage loan credit enhancements				$130,476				$116,534

(1) Underlying loans may be covered by more than one form of credit enhancement.

(2) As of September 30, 2019 and December 31, 2018, our counterparties posted collateral on our ACIS transactions of $2.0 billion and $1.5 billion, respectively.

Guarantee Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to our single-family and multifamily guarantee credit enhancements.

Table 6.2 - Guarantee Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage(2)		Total Current and Protected UPB(1)		Maximum Coverage(2)
Single-family:
Subordination (non-consolidated VIEs)		$22,876		$4,076		$16,271		$2,933
Other	1,129		1,129		1,226		1,226
Total single-family			5,205				4,159
Multifamily:
Subordination (non-consolidated VIEs)	240,485		38,645		220,733		35,661
Other	3,204		919		2,349		815
Total multifamily			39,564				36,476
Total guarantee credit enhancements				$44,769				$40,635

(1) Underlying loans may be covered by more than one form of credit enhancement. For subordination, total current and protected UPB includes the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities, and the UPB of guarantor advances made to the holders of the guaranteed securities.

(2) For subordination, maximum coverage represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties. For all other credit enhancements, maximum coverage represents the remaining amount of loss recovery that is available subject to the terms of counterparty agreements.

Freddie Mac Form 10-Q 77

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 6

Debt with Embedded Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to debt with embedded credit enhancements.

Table 6.3 - Debt with Embedded Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage(2)		Total Current and Protected UPB(1)		Maximum Coverage(2)
Single-family:
STACR debt notes		$554,572		$15,962		$605,263		$17,596
Subordination (consolidated VIEs)	21,843		943		25,006		1,036
Total single-family			16,905				18,632
Multifamily:
SCR notes	2,523		126		2,667		133
Subordination (consolidated VIEs)	2,700		280		2,700		280
Total multifamily			406				413
Total debt with embedded credit enhancements				$17,311				$19,045

(1) Underlying loans may be covered by more than one form of credit enhancement. For STACR debt notes and SCR notes, total current and protected UPB represents the UPB of the assets included in the reference pool. For subordination, total current and protected UPB represents the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities.

(2) For STACR debt notes and SCR notes, maximum coverage amount represents the outstanding balance of the STACR debt notes and SCR notes held by third parties. For subordination, maximum coverage amount represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties.

Other Credit Enhancements

The Multifamily segment also has other credit enhancements in the form of collateral posting requirements, indemnification, pool insurance, bond insurance, recourse, and other similar arrangements. These credit enhancements, along with the proceeds received from the sale of the underlying mortgage collateral, are designed to recover all or a portion of our losses on our mortgage loans or the amounts paid under our financial guarantee contracts. Our historical losses and related recoveries pursuant to these agreements have not been significant and therefore these other types of credit enhancements are excluded from the tables above.

Freddie Mac Form 10-Q 78

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 7

NOTE 7

Investments in Securities

The table below summarizes the fair values of our investments in debt securities by classification.

Table 7.1 - Investments in Securities

(In millions)	September 30, 2019		December 31, 2018
Trading securities		$44,449		$35,548
Available-for-sale securities	28,533		33,563
Total fair value of investments in securities		$72,982		$69,111

As of September 30, 2019 and December 31, 2018, we did not classify any securities as held-to-maturity, although we may elect to do so in the future.

Trading Securities

The table below presents the estimated fair values of our trading securities by major security type. Our non-mortgage-related securities primarily consist of investments in U.S. Treasury securities.

Table 7.2 - Trading Securities

(In millions)	September 30, 2019		December 31, 2018
Mortgage-related securities:
Freddie Mac		$12,972		$13,821
Other agency	7,194		2,551
Non-agency	1		1
Total mortgage-related securities	20,167		16,373
Non-mortgage-related securities	24,282		19,175
Total fair value of trading securities		$44,449		$35,548

For trading securities held at September 30, 2019, we recorded net unrealized gains (losses) of $27 million and $310 million during 3Q 2019 and YTD 2019, respectively. For trading securities held at September 30, 2018, we recorded net unrealized gains (losses) of ($305) million and ($951) million during 3Q 2018 and YTD 2018, respectively.

Available-for-Sale Securities

At September 30, 2019 and December 31, 2018, all available-for-sale securities were mortgage-related securities.

The tables below present the amortized cost, gross unrealized gains and losses, and fair value by major security type for our securities classified as available-for-sale.

Table 7.3 - Available-for-Sale Securities

	September 30, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses					Fair Value
(In millions)					Other-Than-Temporary Impairment(1)		Temporary Impairment(2)
Available-for-sale securities:
Freddie Mac		$25,492		$707		$—		($80	)		$26,119
Other agency	1,005		26		—		(5		)	1,026
Non-agency and other	1,078		310		—		—			1,388
Total available-for-sale securities		$27,575		$1,043		$—		($85	)		$28,533

Freddie Mac Form 10-Q 79

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 7

	December 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses					Fair Value
(In millions)					Other-Than-Temporary Impairment(1)		Temporary Impairment(2)
Available-for-sale securities:
Freddie Mac		$30,407		$320		$—		($528	)		$30,199
Other agency	1,675		38		—		(7		)	1,706
Non-agency and other	1,378		282		—		(2		)	1,658
Total available-for-sale securities		$33,460		$640		$—		($537	)		$33,563

(1) Represents the gross unrealized losses for securities for which we have previously recognized other-than-temporary impairment in earnings.

(2) Represents the gross unrealized losses for securities for which we have not previously recognized other-than-temporary impairment in earnings.

The fair value of our available-for-sale securities held at September 30, 2019 scheduled to contractually mature after ten years was $24.0 billion, with an additional $4.1 billion scheduled to contractually mature after five years through ten years.

Available-for-Sale Securities in a Gross Unrealized Loss Position

The tables below present available-for-sale securities in a gross unrealized loss position and whether such securities have been in an unrealized loss position for less than 12 months, or 12 months or greater.

Table 7.4 - Available-for-Sale Securities in a Gross Unrealized Loss Position

	September 30, 2019
	Less than 12 Months					12 Months or Greater
(In millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Available-for-sale securities:
Freddie Mac		$5,312		($41	)		$2,951		($39	)
Other agency	56		—			531		(5		)
Non-agency and other	—		—			—		—
Total available-for-sale securities in a gross unrealized loss position		$5,368		($41	)		$3,482		($44	)

	December 31, 2018
	Less than 12 Months					12 Months or Greater
(In millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Available-for-sale securities:
Freddie Mac		$4,259		($38	)		$14,751		($490	)
Other agency	351		(1		)	638		(6		)
Non-agency and other	43		(1		)	6		(1		)
Total available-for-sale securities in a gross unrealized loss position		$4,653		($40	)		$15,395		($497	)

At September 30, 2019, the gross unrealized losses relate to 150 separate securities.

Freddie Mac Form 10-Q 80

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 7

Realized Gains and Losses on Sales of Available-for-Sale Securities

The table below summarizes the gross realized gains and gross realized losses from the sale of available-for-sale securities.

Table 7.5 - Gross Realized Gains and Gross Realized Losses from Sales of Available-for-Sale Securities

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Gross realized gains		$68			$69			$169			$544
Gross realized losses	(6		)	(131		)	(40		)	(232		)
Net realized gains (losses)		$62			($62	)		$129			$312

Freddie Mac Form 10-Q 81

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 8

NOTE 8

Debt Securities and Subordinated Borrowings

The table below summarizes the balances of total debt, net per our condensed consolidated balance sheets and the interest expense per our condensed consolidated statements of comprehensive income.

Table 8.1 - Total Debt, Net

	Balance, Net				Interest Expense
(In millions)	September 30, 2019		December 31, 2018		3Q 2019		3Q 2018		YTD 2019		YTD 2018
Debt securities of consolidated trusts held by third parties		$1,869,308		$1,792,677		$13,324		$12,827		$41,001		$37,996
Other debt:
Short-term debt	94,344		51,080		499		361		1,419		832
Long-term debt	185,607		201,193		1,307		1,358		4,078		3,974
Total other debt	279,951		252,273		1,806		1,719		5,497		4,806
Total debt, net		$2,149,259		$2,044,950		$15,130		$14,546		$46,498		$42,802

As of September 30, 2019, our aggregate indebtedness was $282.3 billion, which was below the $300.0 billion debt cap limit imposed by the Purchase Agreement for 2019. Our aggregate indebtedness calculation primarily includes the par value of other short- and long-term debt.

Debt Securities of Consolidated Trusts Held by Third Parties

The table below summarizes the debt securities of consolidated trusts held by third parties based on underlying loan product type.

Table 8.2 - Debt Securities of Consolidated Trusts Held by Third Parties

	September 30, 2019							December 31, 2018
(Dollars in millions)	Contractual Maturity	UPB		Carrying Amount(1)		Weighted Average Coupon(2)		Contractual Maturity	UPB		Carrying Amount(1)		Weighted Average Coupon(2)
Single-family:
30-year or more, fixed-rate	2019 - 2057		$1,487,105		$1,525,505	3.69	%	2019 - 2057		$1,389,113		$1,426,060	3.72	%
20-year fixed-rate	2019 - 2039	69,068		70,764		3.42		2019 - 2039	70,547		72,354		3.43
15-year fixed-rate	2019 - 2034	224,190		227,915		2.89		2019 - 2034	240,310		244,587		2.89
Adjustable-rate	2019 - 2049	32,837		33,474		3.28		2019 - 2049	38,361		39,153		3.12
Interest-only	2026 - 2041	4,608		4,677		4.72		2026 - 2048	5,322		5,386		4.41
FHA/VA	2020 - 2049	665		680		4.69		2019 - 2046	720		736		4.78
Total single-family		1,818,473		1,863,015					1,744,373		1,788,276
Multifamily	2020-2049	6,233		6,293		3.14		2019 - 2047	4,365		4,401		4.02
Total debt securities of consolidated trusts held by third parties			$1,824,706		$1,869,308					$1,748,738		$1,792,677

(1) Includes $737 million and $755 million at September 30, 2019 and December 31, 2018, respectively, of debt of consolidated trusts that represents the fair value of debt securities with the fair value option elected.

(2) The effective interest rate for debt securities of consolidated trusts held by third parties was 2.81% and 3.07% as of September 30, 2019 and December 31, 2018, respectively.

Freddie Mac Form 10-Q 82

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 8

Other Debt

The table below summarizes the balances and effective interest rates for other debt.

Table 8.3 - Total Other Debt

	September 30, 2019						December 31, 2018
(Dollars in millions)	Par Value		Carrying Amount(1)		Weighted Average Effective Rate(2)		Par Value		Carrying Amount(1)			Weighted Average Effective Rate(2)
Other short-term debt:
Discount notes and Reference Bills		$42,719		$42,550	2.09	%		$28,787		$28,621		2.36	%
Medium-term notes	43,098		43,094		2.34		16,440		16,440			2.10
Securities sold under agreements to repurchase	8,700		8,700		2.06		6,019		6,019			2.40
Total other short-term debt	94,517		94,344		2.20		51,246		51,080			2.28
Other long-term debt:
Original maturities on or before December 31,
2019	12,442		12,435		1.63		58,002		57,968			1.54
2020	48,348		48,337		2.00		42,296		42,275			1.78
2021	36,669		36,669		2.05		30,898		30,901			2.06
2022	26,044		26,022		2.34		20,802		20,775			2.46
2023	10,064		10,045		2.65		15,929		15,906			3.09
Thereafter	37,392		34,994		3.68		18,068		15,579			5.91
STACR and SCR debt(3)	16,088		16,257		6.03		17,729		18,004			6.04
Hedging-related basis adjustments	N/A		848				N/A		(215		)
Total other long-term debt	187,047		185,607		2.74		203,724		201,193			2.58
Total other debt(4)		$281,564		$279,951				$254,970		$252,273

(1) Represents par value, net of associated discounts or premiums and issuance cost. Includes $3.9 billion and $4.4 billion at September 30, 2019 and December 31, 2018, respectively, of other long-term debt that represents the fair value of debt securities with the fair value option elected.

(2) Based on carrying amount.

(3) Contractual maturities of these debt securities are not presented because they are subject to prepayment risk, as their payments are based upon the performance of a pool of mortgage assets that may be prepaid by the related mortgage borrower at any time generally without penalty.

(4) Carrying amount for other debt includes callable debt of $105.5 billion and $107.2 billion at September 30, 2019 and December 31, 2018, respectively.

Freddie Mac Form 10-Q 83

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

NOTE 9

Derivatives

Use of Derivatives

We use derivatives primarily to hedge interest-rate sensitivity mismatches between our financial assets and liabilities. We analyze the interest-rate sensitivity of financial assets and liabilities on a daily basis across a variety of interest-rate scenarios based on market prices, models, and economics. When we use derivatives to mitigate our exposures, we consider a number of factors, including cost, exposure to counterparty risk, and our overall risk management strategy.

We classify derivatives into three categories:

n Exchange-traded derivatives;

n Cleared derivatives; and

n OTC derivatives.

Exchange-traded derivatives include standardized interest-rate futures contracts and options on futures contracts. Cleared derivatives refer to those interest-rate swaps that the U.S. Commodity Futures Trading Commission has determined are subject to the central clearing requirement of the Dodd-Frank Act. OTC derivatives refer to those derivatives that are neither exchange-traded derivatives nor cleared derivatives.

Types of Derivatives

We principally use the following types of derivatives:

n LIBOR- and SOFR-based interest-rate swaps;

n LIBOR- and Treasury-based purchased options (including swaptions); and

n LIBOR-, Treasury-, and SOFR-based exchange-traded futures.

We also purchase swaptions on credit indices in order to obtain protection against adverse movements in multifamily spreads which may affect the profitability of our K Certificate or SB Certificate transactions.

In addition to swaps, futures, and purchased options, our derivative positions include written options and swaptions, commitments, and credit derivatives.

Hedge Accounting

Fair Value Hedges

We apply fair value hedge accounting to certain single-family mortgage loans and certain issuances of debt where we hedge the changes in fair value of these items attributable to the designated benchmark interest rate (i.e., LIBOR), using LIBOR-based interest-rate swaps. Beginning in September 2019, we implemented a new fair value hedge accounting strategy for single-family mortgage loans that applies certain hedge accounting elections, including the last-of-layer method, allowable under amended hedge accounting guidance we adopted during 4Q 2017. Under the last-of-layer method, we hedge the changes in fair value of a portion of a closed pool of single-family mortgage loans that is not expected to be affected by prepayments, defaults, and other events affecting the timing and amount of cash flows. As part of this new strategy, we have also elected to measure the change in fair value of the hedged item on the basis of the benchmark rate component of the contractual coupon cash flows determined at the hedge inception and by assuming the hedged item has a term that reflects only the designated cash flows being hedged.

If a hedge relationship qualifies for fair value hedge accounting, all changes in fair value of the derivative hedging instrument, including interest accruals, are recognized in the same condensed consolidated statements of comprehensive income line item used to present the earnings effect of the hedged item. Therefore, changes in the fair value of the hedged item, mortgage loans and debt, attributable to the risk being hedged are recognized in interest income - mortgage loans and interest expense, respectively, along with the changes in the fair value of the respective derivative hedging instruments.

Cash Flow Hedges

There are amounts recorded in AOCI related to discontinued cash flow hedges which are recognized in earnings when the originally forecasted transactions affect earnings. Amounts reclassified from AOCI are recorded in interest expense. During YTD 2019 and YTD 2018, we reclassified from AOCI into earnings, pre-tax losses of $72 million and $106 million, respectively, related to closed cash flow hedges. See Note 11 for information about future reclassifications of deferred net losses related to

Freddie Mac Form 10-Q 84

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

closed cash flow hedges to net income.

Derivative Assets and Liabilities at Fair Value

The table below presents the notional value and fair value of derivatives reported on our condensed consolidated balance sheets.

Table 9.1 - Derivative Assets and Liabilities at Fair Value

	September 30, 2019								December 31, 2018
	Notional or Contractual Amount		Derivatives at Fair Value						Notional or Contractual Amount		Derivatives at Fair Value
(In millions)			Assets			Liabilities					Assets			Liabilities
Not designated as hedges
Interest-rate swaps:
Receive-fixed		$217,377		$2,346			($10	)		$145,386		$1,380			($181	)
Pay-fixed	246,557		6			(4,381		)	170,899		476			(2,287		)
Basis (floating to floating)	5,924		—			—			5,404		1			—
Total interest-rate swaps	469,858		2,352			(4,391		)	321,689		1,857			(2,468		)
Option-based:
Call swaptions
Purchased	61,275		3,963			—			43,625		2,007			—
Written	2,500		—			(37		)	4,400		—			(133		)
Put swaptions
Purchased(1)	63,600		512			—			88,075		1,565			—
Written	8,700		—			(41		)	1,750		—			(4		)
Other option-based derivatives(2)	10,368		721			—			10,481		628			—
Total option-based	146,443		5,196			(78		)	148,331		4,200			(137		)
Futures	181,479		—			—			161,185		—			—
Commitments	152,300		195			(171		)	36,044		90			(179		)
Credit derivatives	1,822		1			(23		)	2,030		—			(35		)
Other	16,991		12			(103		)	12,212		1			(103		)
Total derivatives not designated as hedges	968,893		7,756			(4,766		)	681,491		6,148			(2,922		)
Designated as fair value hedges
Interest-rate swaps:
Receive-fixed	113,425		145			(91		)	117,038		23			(935		)
Pay-fixed	78,966		7			(1,620		)	77,513		247			(571		)
Total derivatives designated as fair value hedges	192,391		152			(1,711		)	194,551		270			(1,506		)
Derivative interest and other receivable (payable)			912			(872		)			889			(1,096		)
Netting adjustments(3)			(7,228		)	6,994					(6,972		)	4,941
Total derivative portfolio, net		$1,161,284		$1,592			($355	)		$876,042		$335			($583	)

(1) Includes swaptions on credit indices with a notional or contractual amount of $17.3 billion and $45.9 billion at September 30, 2019 and December 31, 2018, respectively, and a fair value of $6.0 million and $113.0 million at September 30, 2019 and December 31, 2018, respectively.

(2) Primarily consists of purchased interest-rate caps and floors.

(3) Represents counterparty netting and cash collateral netting.

See Note 10 for information related to our derivative counterparties and collateral held and posted.

Freddie Mac Form 10-Q 85

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

Gains and Losses on Derivatives

The table below presents the gains and losses on derivatives, including the accrual of periodic cash settlements, while not designated in qualifying hedge relationships and reported on our condensed consolidated statements of comprehensive income as derivative gains (losses).

Table 9.2 - Gains and Losses on Derivatives

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Not designated as hedges
Interest-rate swaps:
Receive-fixed		$2,060			($1,004	)		$7,580			($5,080	)
Pay-fixed	(3,866		)	1,721			(12,152		)	7,922
Basis (floating to floating)	(3		)	19			7			(9		)
Total interest-rate swaps	(1,809		)	736			(4,565		)	2,833
Option-based:
Call swaptions
Purchased	1,398			(402		)	2,981			(1,392		)
Written	(109		)	35			(343		)	76
Put swaptions
Purchased	(355		)	136			(1,406		)	524
Written	19			(2		)	83			(23		)
Other option-based derivatives(1)	(6		)	(73		)	93			(205		)
Total option-based	947			(306		)	1,408			(1,020		)
Other:
Futures	(262		)	277			(1,283		)	728
Commitments	(54		)	69			(366		)	672
Credit derivatives	6			(4		)	1			(14		)
Other	2			(71		)	36			(64		)
Total other	(308		)	271			(1,612		)	1,322
Accrual of periodic cash settlements:
Receive-fixed interest-rate swaps	39			39			(32		)	335
Pay-fixed interest-rate swaps	(126		)	(50		)	(220		)	(536		)
Other	40			38			109			40
Total accrual of periodic cash settlements	(47		)	27			(143		)	(161		)
Total		($1,217	)		$728			($4,912	)		$2,974

(1) Primarily consists of purchased interest-rate caps and floors.

Freddie Mac Form 10-Q 86

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

Fair Value Hedges

The tables below present the effects of fair value hedge accounting by condensed consolidated statements of comprehensive income line, including the gains and losses on derivatives and hedged items designated in qualifying hedge relationships and other components due to the application of hedge accounting.

Table 9.3 - Gains and Losses on Fair Value Hedges

	3Q 2019						3Q 2018
(In millions)	Interest Income - Mortgage Loans			Interest Expense			Interest Income - Mortgage Loans			Interest Expense
Total amounts of income and expense line items presented in our condensed consolidated statements of comprehensive income in which the effects of fair value hedges are recorded:		$16,428			($15,130	)		$16,787			($14,546	)
Interest contracts on mortgage loans held-for-investment:
Gain (loss) on fair value hedging relationships:
Hedged items	1,298			—			(755		)	—
Derivatives designated as hedging instruments	(1,588		)	—			776			—
Interest accruals on hedging instruments	(48		)	—			(96		)	—
Discontinued hedge-related basis adjustments amortization	(210		)	—			38			—
Interest contracts on debt:
Gain (loss) on fair value hedging relationships:
Hedged items	—			(36		)	—			121
Derivatives designated as hedging instruments	—			91			—			(50		)
Interest accruals on hedging instruments	—			(18		)	—			(96		)
Discontinued hedge-related basis adjustments amortization	—			18			—			(1		)

	YTD 2019						YTD 2018
(In millions)	Interest Income - Mortgage Loans			Interest Expense			Interest Income - Mortgage Loans			Interest Expense
Total amounts of income and expense line items presented in our condensed consolidated statements of comprehensive income in which the effects of fair value hedges are recorded:		$51,732			($46,498	)		$49,082			($42,802	)
Interest contracts on mortgage loans held-for-investment:
Gain (loss) on fair value hedging relationships:
Hedged items	5,691			—			(3,441		)	—
Derivatives designated as hedging instruments	(5,609		)	—			3,087			—
Interest accruals on hedging instruments	(4		)	—			(373		)	—
Discontinued hedge-related basis adjustments amortization	(229		)	—			86			—
Interest contracts on debt:
Gain (loss) on fair value hedging relationships:
Hedged items	—			(1,141		)	—			931
Derivatives designated as hedging instruments	—			1,288			—			(728		)
Interest accruals on hedging instruments	—			(230		)	—			(219		)
Discontinued hedge-related basis adjustments amortization	—			43			—			(2		)

Freddie Mac Form 10-Q 87

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 9

Cumulative Basis Adjustments Due to Fair Value Hedging

The tables below present the hedged item cumulative basis adjustments due to qualifying fair value hedging and the related hedged item carrying amounts by their respective balance sheet line item.

Table 9.4 - Cumulative Basis Adjustments Due to Fair Value Hedging

	September 30, 2019
	Carrying Amount Assets / (Liabilities)			Cumulative Amount of Fair Value Hedging Basis Adjustment Included in the Carrying Amount									Closed Portfolio Under the Last-of-Layer Method
(In millions)				Total			Under the Last-of-Layer Method			Discontinued - Hedge Related			Total Amount by Amortized Cost Basis		Designated Amount by UPB
Mortgage loans held-for-investment		$470,584			$4,225			($379	)		$4,604			$266,975		$20,472
Debt	(130,653		)	(848		)	—			(114		)	—		—
	December 31, 2018
	Carrying Amount Assets / (Liabilities)			Cumulative Amount of Fair Value Hedging Basis Adjustment Included in the Carrying Amount									Closed Portfolio Under the Last-of-Later Method
(In millions)				Total			Under the Last-of-Layer Method			Discontinued - Hedge Related			Total Amount by Amortized Cost Basis		Designated Amount by UPB
Mortgage loans held-for-investment		$193,547			($1,237	)		$—			($1,237	)		$—		$—
Debt	(127,215		)	216			—			(8		)	—		—

Freddie Mac Form 10-Q 88

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 10

NOTE 10

Collateralized Agreements and Offsetting Arrangements

Derivative Portfolio

Derivative Counterparties

Our use of cleared derivatives, exchange-traded derivatives, and OTC derivatives exposes us to counterparty credit risk. Our use of interest-rate swaps and option-based derivatives is subject to internal credit and legal reviews. On an ongoing basis, we review the credit fundamentals of all of our derivative counterparties, clearinghouses, and clearing members to confirm that they continue to meet our internal risk management standards.

Over-the-Counter Derivatives

We use master netting and collateral agreements to reduce our credit risk exposure to our OTC derivative counterparties. In the event that all of our counterparties for OTC derivatives were to default simultaneously on September 30, 2019, our maximum loss for accounting purposes after applying netting agreements and collateral on an individual counterparty basis would have been approximately $44 million.

Cleared and Exchange-Traded Derivatives

The majority of our interest-rate swaps are subject to the central clearing requirement of the Dodd-Frank Act. A reduction in our credit ratings could cause the clearinghouses or clearing members we use for our cleared and exchange-traded derivatives to demand additional collateral.

Other Derivatives

We also execute forward purchase and sale commitments of loans and mortgage-related securities, including dollar roll transactions, that are treated as derivatives for accounting purposes. The total net exposure on our forward purchase and sale commitments, which are treated as derivatives, was $195 million and $90 million at September 30, 2019 and December 31, 2018, respectively.

Many of our transactions involving forward purchase and sale commitments of mortgage-related securities utilize the Mortgage Backed Securities Division of the Fixed Income Clearing Corporation ("MBSD/FICC") as a clearinghouse. As a clearing member of the clearinghouse, we post margin to the MBSD/FICC and are exposed to the counterparty credit risk of the organization (including its clearing members).

Securities Purchased Under Agreements to Resell

As an investor, we enter into arrangements to purchase securities under agreements to subsequently resell the identical or substantially the same securities to our counterparty. Our counterparties to these transactions are required to pledge the purchased securities as collateral for their obligation to repurchase those securities at a later date. While such transactions involve the legal transfer of securities, they are accounted for as secured financings because the transferor does not relinquish effective control over the securities transferred. These agreements may allow us to repledge all or a portion of the collateral pledged to us, and we may repledge such collateral periodically, although it is not typically our practice to repledge collateral that has been pledged to us.

We consider the types of securities being pledged to us as collateral when determining how much we lend in transactions involving securities purchased under agreements to resell. Additionally, we regularly review the market values of these securities compared to amounts loaned in an effort to manage our exposure to losses.

Securities Sold Under Agreements to Repurchase

Securities sold under agreements to repurchase are effectively collateralized borrowings where we sell securities with an agreement to repurchase such securities at a future date. We are required to pledge the sold securities to the counterparties to these transactions as collateral for our obligation to repurchase these securities at a later date. Similar to the securities purchased under agreements to resell transactions, these transactions involve the legal transfer of securities. However, they are

Freddie Mac Form 10-Q 89

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 10

accounted for as secured financings because they require the identical or substantially the same securities to be subsequently repurchased. These agreements may allow our counterparties to repledge all or a portion of the collateral.

Offsetting of Financial Assets and Liabilities

At September 30, 2019 and December 31, 2018, all amounts of cash collateral related to derivatives with master netting and collateral agreements were offset against derivative assets, net or derivative liabilities, net, as applicable.

The tables below display offsetting and collateral information related to derivatives, securities purchased under agreements to resell, and securities sold under agreements to repurchase which are subject to enforceable master netting agreements or similar arrangements. Securities sold under agreements to repurchase are included in debt, net on our condensed consolidated balance sheets.

Table 10.1 - Offsetting and Collateral Information of Financial Assets and Liabilities

	September 30, 2019
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$8,583			($5,373	)		($1,975	)		$1,235			($1,191	)		$44
Cleared and exchange-traded derivatives	29			(1		)	121			149			—			149
Other	208			—			—			208			—			208
Total derivatives	8,820			(5,374		)	(1,854		)	1,592			(1,191		)	401
Securities purchased under agreements to resell(3)	51,187			—			—			51,187			(51,187		)	—
Total		$60,007			($5,374	)		($1,854	)		$52,779			($52,378	)		$401
Liabilities:
Derivatives:
OTC derivatives		($7,029	)		$5,373			$1,601			($55	)		$—			($55	)
Cleared and exchange-traded derivatives	(23		)	1			19			(3		)	—			(3		)
Other	(297		)	—			—			(297		)	—			(297		)
Total derivatives	(7,349		)	5,374			1,620			(355		)	—			(355		)
Securities sold under agreements to repurchase(3)	(8,700		)	—			—			(8,700		)	8,700			—
Total		($16,049	)		$5,374			$1,620			($9,055	)		$8,700			($355	)

Referenced footnotes are included after the next table.

Freddie Mac Form 10-Q 90

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 10

	December 31, 2018
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance  Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$7,213			($4,544	)		($2,448	)		$221			($173	)		$48
Cleared and exchange-traded derivatives	3			—			20			23			—			23
Other	91			—			—			91			—			91
Total derivatives	7,307			(4,544		)	(2,428		)	335			(173		)	162
Securities purchased under agreements to resell(3)	34,771			—			—			34,771			(34,771		)	—
Total		$42,078			($4,544	)		($2,428	)		$35,106			($34,944	)		$162
Liabilities:
Derivatives:
OTC derivatives		($4,963	)		$4,544			$296			($123	)		$—			($123	)
Cleared and exchange-traded derivatives	(244		)	—			101			(143		)	—			(143		)
Other	(317		)	—			—			(317		)	—			(317		)
Total derivatives	(5,524		)	4,544			397			(583		)	—			(583		)
Securities sold under agreements to repurchase(3)	(6,019		)	—			—			(6,019		)	6,019			—
Total		($11,543	)		$4,544			$397			($6,602	)		$6,019			($583	)

(1) Excess cash collateral held is presented as a derivative liability, while excess cash collateral posted is presented as a derivative asset.

(2) Does not include the fair value amount of non-cash collateral posted or held that exceeds the associated net asset or liability, netted by counterparty, presented on the condensed consolidated balance sheets. For cleared and exchange-traded derivatives, does not include non-cash collateral posted by us as initial margin with an aggregate fair value of $4.0 billion and $2.5 billion as of September 30, 2019 and December 31, 2018, respectively.

(3) Does not include the impacts of netting by central clearing organizations.

We primarily execute securities purchased under agreements to resell transactions with central clearing organizations where we have the right to repledge the collateral that has been pledged to us, either with the central clearing organization or with other counterparties. At September 30, 2019, and December 31, 2018, we had $27.6 billion and $20.1 billion, respectively, of securities pledged to us in these transactions. In addition, at September 30, 2019 and December 31, 2018, we had $2.2 billion and $2.5 billion, respectively, of securities pledged to us for transactions involving securities purchased under agreements to resell not executed with central clearing organizations that we had the right to repledge.

Freddie Mac Form 10-Q 91

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 10

Collateral Pledged

Collateral Pledged to Freddie Mac

We have cash pledged to us as collateral primarily related to OTC derivative transactions. At September 30, 2019, we had $3.1 billion pledged to us as collateral that was invested as part of our liquidity and contingency operating portfolio.

Collateral Pledged by Freddie Mac

The tables below summarize the fair value of the securities pledged as collateral by us for derivatives and collateralized borrowing transactions, including securities that the secured party may repledge.

Table 10.2 - Collateral in the Form of Securities Pledged

	September 30, 2019
(In millions)	Derivatives		Securities sold under agreements to repurchase		Other(3)		Total
Cash equivalents(1)		$—		$284		$—		$284
Debt securities of consolidated trusts(2)	747		—		169		916
Available-for-sale securities	—		—		3		3
Trading securities	3,228		8,429		57		11,714
Total securities pledged		$3,975		$8,713		$229		$12,917

	December 31, 2018
(In millions)	Derivatives		Securities sold under agreements to repurchase		Other(3)		Total
Cash equivalents(1)		$—		$2,595		$—		$2,595
Debt securities of consolidated trusts(2)	362		—		179		541
Available-for-sale securities	—		—		1		1
Trading securities	2,160		3,432		73		5,665
Total securities pledged		$2,522		$6,027		$253		$8,802

(1) Represents U.S. Treasury securities accounted for as cash equivalents.

(2) Represents debt securities of consolidated trusts held by us in our Capital Markets segment mortgage investments portfolio which are recorded as a reduction to debt securities of consolidated trusts held by third parties on our condensed consolidated balance sheets.

(3) Includes other collateralized borrowings and collateral related to transactions with certain clearinghouses.

The table below summarizes the underlying collateral pledged and the remaining contractual maturity of our gross obligations under securities sold under agreements to repurchase.

Table 10.3 - Underlying Collateral Pledged

	September 30, 2019
(In millions)	Overnight and continuous		30 days or less		After 30 days through 90 days		Greater than 90 days		Total
U.S. Treasury securities and other		$2,684		$5,112		$917		$—		$8,713

Freddie Mac Form 10-Q 92

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 11

NOTE 11

Stockholders' Equity and Earnings Per Share

Accumulated Other Comprehensive Income

The tables below present changes in AOCI after the effects of our federal statutory tax rate of 21% for YTD 2019 and YTD 2018, related to available-for-sale securities, closed cash flow hedges, and our defined benefit plans.

Table 11.1 - Changes in AOCI by Component, Net of Taxes

	YTD 2019
(In millions)	AOCI Related to Available- For-Sale Securities			AOCI Related to Cash Flow Hedge Relationships			AOCI Related to Defined Benefit Plans			Total
Beginning balance		$83			($315	)		$97			($135	)
Other comprehensive income before reclassifications	776			—			(2		)	774
Amounts reclassified from accumulated other comprehensive income	(102		)	57			(12		)	(57		)
Changes in AOCI by component	674			57			(14		)	717
Ending balance		$757			($258	)		$83			$582
	YTD 2018
(In millions)	AOCI Related to Available- For-Sale Securities			AOCI Related to Cash Flow Hedge Relationships			AOCI Related to Defined Benefit Plans			Total
Beginning balance		$662			($356	)		$83			$389
Other comprehensive income before reclassifications	(821		)	—			(1		)	(822		)
Amounts reclassified from accumulated other comprehensive income	(244		)	87			(12		)	(169		)
Changes in AOCI by component	(1,065		)	87			(13		)	(991		)
Cumulative effect of change in accounting principle(1)	143			(73		)	19			89
Ending balance		($260	)		($342	)		$89			($513	)

(1) Includes the effect of adopting the accounting guidance on reclassification of stranded tax effects of the Tax Cuts and Jobs Act in 1Q 2018.

Freddie Mac Form 10-Q 93

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 11

Reclassifications from AOCI to Net Income

The table below presents reclassifications from AOCI to net income, including the affected line item in our condensed consolidated statements of comprehensive income.

Table 11.2 - Reclassifications from AOCI to Net Income

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
AOCI related to available-for-sale securities
Affected line items in the consolidated statements of comprehensive income:
Investment securities gains (losses)		$62			($64	)		$129			$309
Income tax (expense) or benefit	(13		)	13			(27		)	(65		)
Net of tax	49			(51		)	102			244
AOCI related to cash flow hedge relationships
Affected line items in the consolidated statements of comprehensive income:
Interest expense	(24		)	(31		)	(72		)	(106		)
Income tax (expense) or benefit	5			6			15			19
Net of tax	(19		)	(25		)	(57		)	(87		)
AOCI related to defined benefit plans
Affected line items in the consolidated statements of comprehensive income:
Salaries and employee benefits	5			5			15			15
Income tax (expense) or benefit	(1		)	(1		)	(3		)	(3		)
Net of tax	4			4			12			12
Total reclassifications in the period net of tax		$34			($72	)		$57			$169

Future Reclassifications from AOCI to Net Income Related to Closed Cash Flow Hedges

The total AOCI related to derivatives designated as cash flow hedges was a loss of $0.3 billion at both September 30, 2019 and September 30, 2018, composed of deferred net losses on closed cash flow hedges. Closed cash flow hedges involve derivatives that have been terminated or are no longer designated as cash flow hedges. Fluctuations in prevailing market interest rates have no effect on the deferred portion of AOCI relating to losses on closed cash flow hedges.

The previously deferred amount related to closed cash flow hedges remains in our AOCI balance and will be recognized into earnings over the expected time period for which the forecasted transactions affect earnings, unless it is deemed probable that the forecasted transactions will not occur. Over the next 12 months, we estimate that approximately $49 million, net of taxes, of the $0.3 billion of cash flow hedge losses in AOCI at September 30, 2019 will be reclassified into earnings. The maximum remaining length of time over which we have hedged the exposure related to the variability in future cash flows on forecasted transactions, primarily forecasted debt issuances, is 14 years.

Senior Preferred Stock

Pursuant to the September 2019 Letter Agreement, for each dividend period from July 1, 2019 and thereafter, the applicable Capital Reserve Amount used in determining the dividend payable to Treasury will be $20.0 billion, rather than $3.0 billion as previously provided. As a result of this change, we did not have a dividend requirement to Treasury in September 2019, as our Net Worth Amount of $4.8 billion as of June 30, 2019 was lower than the $20.0 billion applicable Capital Reserve Amount.

As of September 30, 2019, our assets exceeded our liabilities under GAAP; therefore, no draw is being requested from Treasury under the Purchase Agreement. Based on our Net Worth Amount of $6.7 billion as of September 30, 2019 and the applicable Capital Reserve Amount of $20.0 billion, we will not have a dividend requirement to Treasury in December 2019. See Note 2 for additional information. Our cumulative senior preferred stock dividend payments remain at $119.7 billion as of September 30, 2019.

The aggregate liquidation preference of the senior preferred stock owned by Treasury was $75.6 billion as of June 30, 2019. Pursuant to the September 2019 Letter Agreement, the liquidation preference of the senior preferred stock will be increased, at the end of each fiscal quarter, beginning on September 30, 2019, by an amount equal to the increase in the Net Worth Amount, if any, during the immediately prior fiscal quarter, until the liquidation preference has increased by $17.0 billion. During 2Q 2019, our Net Worth Amount increased by $1.8 billion. As a result, the liquidation preference of the senior preferred stock increased to

Freddie Mac Form 10-Q 94

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 11

$77.5 billion on September 30, 2019, and will increase to $79.3 billion on December 31, 2019 based on the $1.8 billion increase in our Net Worth Amount during 3Q 2019.

The table below provides a summary of our senior preferred stock outstanding at September 30, 2019.

Table 11.3 - Senior Preferred Stock

(In millions, except initial liquidation preference price per share)	Shares Authorized	Shares Outstanding	Total Par Value		Initial Liquidation Preference Price per Share		Total Liquidation Preference
Non-draw Adjustment Dates:
September 8, 2008	1.00	1.00		$1.00		$1,000		$1,000
December 31, 2017	—	—	—		N/A		3,000
September 30, 2019	—	—	—		N/A		1,826
Draw Dates:
November 24, 2008	—	—	—		N/A		13,800
March 31, 2009	—	—	—		N/A		30,800
June 30, 2009	—	—	—		N/A		6,100
June 30, 2010	—	—	—		N/A		10,600
September 30, 2010	—	—	—		N/A		1,800
December 30, 2010	—	—	—		N/A		100
March 31, 2011	—	—	—		N/A		500
September 30, 2011	—	—	—		N/A		1,479
December 30, 2011	—	—	—		N/A		5,992
March 30, 2012	—	—	—		N/A		146
June 29, 2012	—	—	—		N/A		19
March 30, 2018	—	—	—		N/A		312
Total senior preferred stock	1.00	1.00		$1.00				$77,474

Stock Issuances and Repurchases

We did not repurchase or issue any of our common shares or non-cumulative preferred stock during 3Q 2019.

Earnings Per Share

We have participating securities related to restricted stock units with dividend equivalent rights that receive dividends as declared on an equal basis with common shares but are not obligated to participate in undistributed net losses. These participating securities consist of vested RSUs that earn dividend equivalents at the same rate when and as declared on common stock.

Consequently, in accordance with accounting guidance, we use the "two-class" method of computing earnings per common share. The "two-class" method is an earnings allocation formula that determines earnings per share for common stock and participating securities based on dividends declared and participation rights in undistributed earnings.

Basic earnings per common share is computed as net income attributable to common stockholders divided by the weighted average common shares outstanding for the period. The weighted average common shares outstanding for the period includes the weighted average number of shares that are associated with the warrant for our common stock issued to Treasury pursuant to the Purchase Agreement. These shares are included since the warrant is unconditionally exercisable by the holder at a minimal cost.

Diluted earnings per common share is computed as net income attributable to common stockholders divided by the weighted average common shares outstanding during the period adjusted for the dilutive effect of common equivalent shares outstanding. For periods with net income attributable to common stockholders, the calculation includes the effect of the weighted-average of RSUs.

During periods in which a net loss attributable to common stockholders has been incurred, potential common equivalent shares outstanding are not included in the calculation because it would have an antidilutive effect.

There were no stock options outstanding at both September 30, 2019 and September 30, 2018.

Freddie Mac Form 10-Q 95

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 11

Dividends and Dividend Restrictions

No common dividends were declared during YTD 2019. At the direction of our Conservator, we paid dividends of $1.5 billion and $1.7 billion on the senior preferred stock during 1Q 2019 and 2Q 2019, respectively. As a result of the increase in the applicable Capital Reserve Amount pursuant to the September 2019 Letter Agreement, we did not declare or pay a dividend on the senior preferred stock during 3Q 2019. We also did not declare or pay dividends on any other series of Freddie Mac preferred stock outstanding during YTD 2019.

Our payment of dividends on Freddie Mac common stock or any series of Freddie Mac preferred stock (other than senior preferred stock) is subject to certain restrictions as described in Note 11 in our 2018 Annual Report.

Freddie Mac Form 10-Q 96

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 12

NOTE 12

Income Taxes

Income Tax Expense

For 3Q 2019 and 3Q 2018, we reported income tax expense of $0.4 billion and $0.6 billion, respectively, resulting in effective tax rates of 20.0% and 17.0%, respectively. For YTD 2019 and YTD 2018, we reported income tax expense of $1.2 billion and $1.9 billion, respectively, resulting in effective tax rates of 20.3% and 19.3%, respectively. Our effective tax rates differed from the statutory tax rate of 21% in these periods primarily due to our recognition of low income housing tax credits and tax-exempt interest income.

Deferred Tax Assets, Net

We had net deferred tax assets of $5.8 billion and $6.9 billion as of September 30, 2019 and December 31, 2018, respectively. At September 30, 2019, our net deferred tax assets consisted primarily of basis differences related to derivative instruments and deferred fees.

Based on all positive and negative evidence available at September 30, 2019, we determined that it is more likely than not that our net deferred tax assets, except for a portion of the deferred tax asset related to our capital loss carryforward, will be realized. As of September 30, 2019, we have a $37 million valuation allowance recorded against our capital loss carryforward deferred tax asset.

Unrecognized Tax Benefits

We evaluated all income tax positions and determined that there were no uncertain tax positions that required reserves as of September 30, 2019.

We are under IRS examination for tax years 2013 through 2016 related to the carryback of 2016 capital losses to the prior three years.

Freddie Mac Form 10-Q 97

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

NOTE 13

Segment Reporting

We have three reportable segments, which are based on the type of business activities each performs - Single-family Guarantee, Multifamily, and Capital Markets. Material corporate-level activities that are infrequent in nature and based on decisions outside the control of the management of our reportable segments are included in the All Other category. For more information, see our 2018 Annual Report.

Segment Earnings

We present Segment Earnings by reclassifying certain credit guarantee-related activities and investment-related activities between various line items on our GAAP condensed consolidated statements of comprehensive income and allocating certain revenues and expenses, including certain returns on assets, funding and hedging costs, and administrative expenses, to our three reportable segments.

We do not consider our assets by segment when evaluating segment performance or allocating resources. We operate our business in the United States and its territories, and accordingly, we generate no revenue from and have no long-lived assets, other than financial instruments, in geographic locations other than the United States and its territories.

We evaluate segment performance and allocate resources based on a Segment Earnings approach, subject to the conduct of our business under the direction of the Conservator. See Note 2 for information about the conservatorship.

The table below presents Segment Earnings by segment.

Table 13.1 - Segment Earnings

(In millions)	3Q 2019			3Q 2018		YTD 2019		YTD 2018
Segment Earnings (loss), net of taxes:
Single-family Guarantee		$1,250			$1,183		$2,945		$2,884
Multifamily	581			549		1,294		1,572
Capital Markets	(122		)	974		383		3,679
All Other	—			—		—		—
Total Segment Earnings, net of taxes	1,709			2,706		4,622		8,135
Net income (loss)		$1,709			$2,706		$4,622		$8,135
Comprehensive income (loss) of segments:
Single-family Guarantee		$1,247			$1,181		$2,936		$2,876
Multifamily	591			505		1,426		1,436
Capital Markets	10			873		977		2,832
All Other	—			—		—		—
Comprehensive income (loss) of segments	1,848			2,559		5,339		7,144
Comprehensive income (loss)		$1,848			$2,559		$5,339		$7,144

Freddie Mac Form 10-Q 98

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

The tables below present detailed reconciliations between our GAAP condensed consolidated statements of comprehensive income and Segment Earnings for our reportable segments and All Other.

Table 13.2 - Segment Earnings and Reconciliations to GAAP Condensed Consolidated Statements of Comprehensive Income

	3Q 2019
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$292			$497			$—		$789			$1,621			$2,410
Guarantee fee income	2,075			233			—			—		2,308			(2,077		)	231
Benefit (provision) for credit losses	134			(1		)	—			—		133			46			179
Mortgage loans gains (losses)	—			1,087			—			—		1,087			615			1,702
Investment securities gains (losses)	—			31			136			—		167			(3		)	164
Debt gains (losses)	51			(69		)	(17		)	—		(35		)	(21		)	(56		)
Derivative gains (losses)	—			(793		)	(438		)	—		(1,231		)	14			(1,217		)
Other income (loss)	318			89			(234		)	—		173			(27		)	146
Administrative expense	(399		)	(125		)	(96		)	—		(620		)	—			(620		)
REO operations (expense) income	(61		)	—			—			—		(61		)	3			(58		)
Other non-interest (expense) income	(554		)	(17		)	(3		)	—		(574		)	(171		)	(745		)
Income tax (expense) benefit	(314		)	(146		)	33			—		(427		)	—			(427		)
Net income (loss)	1,250			581			(122		)	—		1,709			—			1,709
Changes in unrealized gains (losses) related to available-for-sale securities	—			10			114			—		124			—			124
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			19			—		19			—			19
Changes in defined benefit plans	(3		)	—			(1		)	—		(4		)	—			(4		)
Total other comprehensive income (loss), net of taxes	(3		)	10			132			—		139			—			139
Comprehensive income (loss)		$1,247			$591			$10			$—		$1,848			$—			$1,848
	YTD 2019
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$805			$2,002			$—		$2,807			$5,683			$8,490
Guarantee fee income	5,597			671			—			—		6,268			(5,598		)	670
Benefit (provision) for credit losses	221			(3		)	—			—		218			256			474
Mortgage loans gains (losses)	—			2,909			—			—		2,909			1,265			4,174
Investment securities gains (losses)	—			41			698			—		739			(11		)	728
Debt gains (losses)	113			(46		)	(27		)	—		40			(32		)	8
Derivative gains (losses)	(47		)	(2,650		)	(2,095		)	—		(4,792		)	(120		)	(4,912		)
Other income (loss)	836			292			198			—		1,326			(937		)	389
Administrative expense	(1,173		)	(357		)	(287		)	—		(1,817		)	—			(1,817		)
REO operations (expense) income	(185		)	—			—			—		(185		)	13			(172		)
Other non-interest (expense) income	(1,667		)	(38		)	(9		)	—		(1,714		)	(519		)	(2,233		)
Income tax (expense) benefit	(750		)	(330		)	(97		)	—		(1,177		)	—			(1,177		)
Net income (loss)	2,945			1,294			383			—		4,622			—			4,622
Changes in unrealized gains (losses) related to available-for-sale securities	—			134			540			—		674			—			674
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			57			—		57			—			57
Changes in defined benefit plans	(9		)	(2		)	(3		)	—		(14		)	—			(14		)
Total other comprehensive income (loss), net of taxes	(9		)	132			594			—		717			—			717
Comprehensive income (loss)		$2,936			$1,426			$977			$—		$5,339			$—			$5,339

Freddie Mac Form 10-Q 99

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 13

	3Q 2018
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$280			$845			$—		$1,125			$2,132			$3,257
Guarantee fee income	1,676			210			—			—		1,886			(1,677		)	209
Benefit (provision) for credit losses	205			2			—			—		207			173			380
Mortgage loans gains (losses)	—			(17		)	—			—		(17		)	111			94
Investment securities gains (losses)	—			(97		)	(336		)	—		(433		)	(10		)	(443		)
Debt gains (losses)	20			5			137			—		162			(4		)	158
Derivative gains (losses)	(25		)	375			427			—		777			(49		)	728
Other income (loss)	387			27			179			—		593			(514		)	79
Administrative expense	(371		)	(109		)	(89		)	—		(569		)	—			(569		)
REO operations (expense) income	(42		)	—			—			—		(42		)	4			(38		)
Other non-interest (expense) income	(413		)	(14		)	—			—		(427		)	(166		)	(593		)
Income tax (expense) benefit	(254		)	(113		)	(189		)	—		(556		)	—			(556		)
Net income (loss)	1,183			549			974			—		2,706			—			2,706
Changes in unrealized gains (losses) related to available-for-sale securities	—			(44		)	(125		)	—		(169		)	—			(169		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			25			—		25			—			25
Changes in defined benefit plans	(2		)	—			(1		)	—		(3		)	—			(3		)
Total other comprehensive income (loss), net of taxes	(2		)	(44		)	(101		)	—		(147		)	—			(147		)
Comprehensive income (loss)		$1,181			$505			$873			$—		$2,559			$—			$2,559
	YTD 2018
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$846			$2,410			$—		$3,256			$6,022			$9,278
Guarantee fee income	4,932			609			—			—		5,541			(4,938		)	603
Benefit (provision) for credit losses	366			20			—			—		386			(9		)	377
Mortgage loans gains (losses)	—			(233		)	—			—		(233		)	466			233
Investment securities gains (losses)	—			(353		)	(524		)	—		(877		)	(147		)	(1,024		)
Debt gains (losses)	80			22			368			—		470			(25		)	445
Derivative gains (losses)	(37		)	1,254			2,038			—		3,255			(281		)	2,974
Other income (loss)	592			128			541			—		1,261			(613		)	648
Administrative expense	(1,070		)	(315		)	(262		)	—		(1,647		)	—			(1,647		)
REO operations (expense) income	(101		)	1			—			—		(100		)	13			(87		)
Other non-interest (expense) income	(1,192		)	(33		)	(6		)	—		(1,231		)	(488		)	(1,719		)
Income tax (expense) benefit	(686		)	(374		)	(886		)	—		(1,946		)	—			(1,946		)
Net income (loss)	2,884			1,572			3,679			—		8,135			—			8,135
Changes in unrealized gains (losses) related to available-for-sale securities	—			(134		)	(931		)	—		(1,065		)	—			(1,065		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			87			—		87			—			87
Changes in defined benefit plans	(8		)	(2		)	(3		)	—		(13		)	—			(13		)
Total other comprehensive income (loss), net of taxes	(8		)	(136		)	(847		)	—		(991		)	—			(991		)
Comprehensive income (loss)		$2,876			$1,436			$2,832			$—		$7,144			$—			$7,144

Freddie Mac Form 10-Q 100

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 14

NOTE 14

Concentration of Credit and Other Risks

Single-Family Credit Guarantee Portfolio

The table below summarizes the concentration by loan portfolio and geographic area of the approximately $2.0 trillion and $1.9 trillion UPB of our single-family credit guarantee portfolio as of September 30, 2019 and December 31, 2018, respectively. See Note 4 and Note 7 for more information about credit risk associated with loans and mortgage-related securities that we hold or guarantee.

Table 14.1 - Concentration of Credit Risk of Our Single-Family Credit Guarantee Portfolio

	September 30, 2019				December 31, 2018				Percent of Credit Losses
	Percentage  of Portfolio		Serious Delinquency Rate		Percentage  of Portfolio		Serious Delinquency Rate		YTD 2019		YTD 2018
Core single-family loan portfolio	84	%	0.24	%	82	%	0.22	%	16	%	12	%
Legacy and relief refinance single-family loan portfolio	16		1.77		18		1.93		84		88
Total	100	%	0.61		100	%	0.69		100	%	100	%
Region(1)
West	30	%	0.35		30	%	0.38		12	%	17	%
Northeast	24		0.86		24		0.96		40		40
North Central	16		0.60		16		0.63		19		18
Southeast	16		0.72		16		0.90		22		18
Southwest	14		0.51		14		0.57		7		7
Total	100	%	0.61		100	%	0.69		100	%	100	%
State(2)
Florida	6	%	0.75		6	%	1.01		14	%	10	%
New York	5		1.20		5		1.37		12		12
New Jersey	3		1.07		3		1.24		10		10
Illinois	4		0.82		5		0.86		10		9
California	18		0.33		18		0.35		7		10
All other	64		0.57		63		0.64		47		49
Total	100	%	0.61	%	100	%	0.69	%	100	%	100	%

(1) Region designation: West (AK, AZ, CA, GU, HI, ID, MT, NV, OR, UT, WA); Northeast (CT, DE, DC, MA, ME, MD, NH, NJ, NY, PA, RI, VT, VA, WV); North Central (IL, IN, IA, MI, MN, ND, OH, SD, WI); Southeast (AL, FL, GA, KY, MS, NC, PR, SC, TN, VI); Southwest (AR, CO, KS, LA, MO, NE, NM, OK, TX, WY).

(2) States presented based on those with the highest percentage of credit losses during YTD 2019.

Credit Performance of Certain Higher Risk Single-Family Loan Categories

Participants in the mortgage market have characterized single-family loans based upon their overall credit quality at the time of origination, including as prime or subprime. Mortgage market participants have classified single-family loans as Alt-A if these loans have credit characteristics that range between their prime and subprime categories, if they are underwritten with lower or alternative income or asset documentation requirements compared to a full documentation loan, or both. Although we discontinued new purchases of loans with lower documentation standards beginning March 1, 2009, we continued to purchase certain amounts of these loans in cases where the loan was either:

n Purchased pursuant to a previously issued other mortgage-related guarantee;

n Part of our relief refinance initiative; or

n In another refinance loan initiative and the pre-existing loan (including Alt-A loans) was originated under less than full documentation standards.

Freddie Mac Form 10-Q 101

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 14

In the event we purchase a refinance loan and the original loan had been previously identified as Alt-A, such refinance loan may no longer be categorized or reported as Alt-A in the table below because the new refinance loan replacing the original loan would not be identified by the seller/servicer as an Alt-A loan. As a result, our reported Alt-A balances may be lower than would otherwise be the case had such refinancing not occurred.

Although we do not categorize single-family loans we purchase or guarantee as prime or subprime, we recognize that there are a number of loan types with certain characteristics that indicate a higher degree of credit risk.

For example, a borrower's credit score is a useful measure for assessing the credit quality of the borrower. Statistically, borrowers with higher credit scores are more likely to repay or have the ability to refinance than those with lower scores.

Presented below is a summary of the serious delinquency rates of certain higher-risk categories (based on characteristics of the loan at origination) of loans in our single-family credit guarantee portfolio. The table includes a presentation of each higher-risk category in isolation. A single loan may fall within more than one category (for example, an interest-only loan may also have an original LTV ratio greater than 90%). Loans with a combination of these attributes will have an even higher risk of delinquency than those with an individual attribute.

Table 14.2 - Certain Higher Risk Categories in Our Single-Family Credit Guarantee Portfolio

	Percentage of Portfolio(1)				Serious Delinquency Rate(1)
(Percentage of portfolio based on UPB)	September 30, 2019		December 31, 2018		September 30, 2019		December 31, 2018
Interest-only	1	%	1	%	2.72	%	3.43	%
Alt-A	1		1		3.75		4.13
Original LTV ratio greater than 90%(2)	18		18		0.92		1.04
Lower credit scores at origination (less than 620)	2		2		4.24		4.59

(1) Excludes loans underlying certain other securitization products for which data was not available.

(2) Includes HARP loans, which we purchased as part of our participation in the MHA Program.

Sellers and Servicers

Sellers

We acquire a significant portion of our single-family and multifamily loan purchase volume from several large sellers. The tables below summarize the concentration of single-family and multifamily sellers who provided 10% or more of our purchase volume during YTD 2019 or YTD 2018.

Table 14.3 - Seller Concentration

Single-family Sellers(1)	YTD 2019		YTD 2018
JPMorgan Chase Bank, N.A.	16	%	5	%
Wells Fargo Bank, N.A.	7		12
Other top 10 sellers	33		32
Top 10 single-family sellers	56	%	49	%
Multifamily Sellers(1)	YTD 2019		YTD 2018
CBRE Capital Markets, Inc.	16	%	19	%
Berkadia Commercial Mortgage LLC	15		12
Other top 10 sellers	48		47
Top 10 multifamily sellers	79	%	78	%

(1) Sellers presented based on those with the highest percentage of purchase volume during YTD 2019.

In recent years, there has been a shift in our single-family purchase volume from depository institutions to non-depository and smaller depository financial institutions. Some of these non-depository sellers have grown in recent years, and we purchase a significant share of our loans from them. Our top five non-depository sellers provided approximately 26% and 22% of our single-family purchase volume during YTD 2019 and YTD 2018, respectively.

Servicers

Significant portions of our single-family and multifamily loans are serviced by several large servicers. The tables below summarize the concentration of single-family and multifamily servicers who serviced 10% or more of our single-family credit guarantee portfolio and our multifamily mortgage portfolio as of September 30, 2019 or December 31, 2018. For purposes of determining the concentration of servicers in the tables below, our multifamily mortgage portfolio excludes loans underlying multifamily securitizations where we are not in first loss position, primarily K Certificates and SB Certificates.

Freddie Mac Form 10-Q 102

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 14

Table 14.4 - Servicer Concentration

Single-family Servicers(2)	September 30, 2019(1)		December 31, 2018(1)
Wells Fargo Bank, N.A.	15	%	17	%
JPMorgan Chase Bank, N.A.	10		8
Other top 10 servicers	31		31
Top 10 single-family servicers	56	%	56	%

Multifamily Servicers(2)	September 30, 2019		December 31, 2018
Wells Fargo Bank, N.A.	15	%	14	%
Berkadia Commercial Mortgage LLC	11		11
CBRE Capital Markets, Inc.	11		14
Other top 10 servicers	40		36
Top 10 multifamily servicers	77	%	75	%

(1) Percentage of servicing volume is based on the total single-family credit guarantee portfolio, which includes loans where we do not exercise servicing control. However, loans where we do not exercise servicing control are not included for purposes of determining the concentration of servicers who serviced more than 10% of our single-family credit guarantee portfolio because we do not know which entity serves as the primary servicer for such loans.

(2) Servicers presented based on those with the highest percentage of servicing volume as of September 30, 2019.

In recent years, there has been a shift in our single-family servicing from depository institutions to non-depository servicers. Some of these non-depository servicers have grown in recent years and now service a large share of our loans. As of September 30, 2019 and December 31, 2018, approximately 18% and 16%, respectively, of our single-family credit guarantee portfolio was serviced by our top five non-depository servicers. We actively manage the performance of our largest non-depository servicers. Additionally, as part of our efforts on home ownership retention and loss mitigation, we have been consolidating a portion of our default servicing with Freddie Mac selected specialty servicers.

Credit Enhancement Providers

We have counterparty credit risk relating to the potential insolvency of, or non-performance by, mortgage insurers that insure single-family loans we purchase or guarantee. We also have similar exposure to insurers and reinsurers through our ACIS transactions where we purchase insurance policies as part of our CRT activities.

In March 2019, we implemented a set of revised Private Mortgage Insurer Eligibility Requirements (PMIERs) with enhancements to the risk-based capital requirements for mortgage insurers. In addition, we revised master policies with mortgage insurers which provide contract certainty and improve our ability to collect claims for mortgage insurance obligations. These policies were approved by FHFA and are expected to become effective during 2020.

We evaluate the recovery and collectability from mortgage insurers as part of the estimate of our allowance for credit losses. See Note 4 for additional information. As of September 30, 2019, mortgage insurers provided coverage with maximum loss limits of $105.2 billion, for $411.0 billion of UPB, in connection with our single-family credit guarantee portfolio. These amounts are based on gross coverage without regard to netting of coverage that may exist to the extent an affected loan is covered under both primary and pool insurance.

The table below summarizes the concentration of mortgage insurer counterparties who provided 10% or more of our overall mortgage insurance coverage. On October 23, 2016, Genworth Financial, Inc. announced that it had entered into an agreement to be acquired by China Oceanwide Holdings Group Co., Ltd. Because Genworth Mortgage Insurance Corporation, a subsidiary of Genworth Financial, Inc., is an approved mortgage insurer, Freddie Mac has evaluated the planned acquisition and approved China Oceanwide Holdings Group's control of Genworth Mortgage Insurance Corporation. Regulatory and other approvals of the acquisition are still pending.

Table 14.5 - Mortgage Insurer Concentration

		Mortgage Insurance Coverage(2)
Mortgage Insurer	Credit Rating(1)	September 30, 2019		December 31, 2018
Arch Mortgage Insurance Company	A-	22	%	24	%
Radian Guaranty Inc.	BBB	20		20
Mortgage Guaranty Insurance Corporation	BBB	18		19
Genworth Mortgage Insurance Corporation	BB+	15		14
Essent Guaranty, Inc.	BBB+	15		14
Total		90	%	91	%

(1) Ratings are for the corporate entity to which we have the greatest exposure. Latest rating available as of September 30, 2019. Represents the lower of S&P and Moody’s credit ratings stated in terms of the S&P equivalent.

(2) Includes primary mortgage insurance and pool insurance. Coverage amounts may include coverage provided by affiliates and subsidiaries of the counterparty.

Freddie Mac Form 10-Q 103

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 14

We received proceeds of $0.1 billion and $0.2 billion during YTD 2019 and YTD 2018, respectively, from our primary and pool mortgage insurance policies for recovery of losses on our single-family loans. We had outstanding receivables from mortgage insurers of $0.1 billion (excluding deferred payment obligations associated with unpaid claim amounts) as of both September 30, 2019 and December 31, 2018. The balance of these receivables, net of associated reserves, was approximately $0.1 billion at both September 30, 2019 and December 31, 2018.

PMI Mortgage Insurance Co. and Triad Guaranty Insurance Corp. are both under the control of their state regulators and are in run-off. A substantial portion of their claims is recorded by us as deferred payment obligations. As of both September 30, 2019 and December 31, 2018, we had cumulative unpaid deferred payment obligations of $0.5 billion from these insurers. We have reserved substantially all of these unpaid amounts as collectability is uncertain. It is not clear how the regulators of these companies will administer their respective deferred payment plans in the future, nor when or if those obligations will be paid.

As part of our ACIS and other CRT transactions, we regularly obtain insurance coverage from insurers and reinsurers. These transactions incorporate several features designed to increase the likelihood that we will recover on the claims we file with the insurers and reinsurers, including the following:

n In each transaction, we require the individual insurers and reinsurers to post collateral to cover portions of their exposure, which helps to promote certainty and timeliness of claim payment and

n While private mortgage insurance companies are required to be monoline (i.e., to participate solely in the mortgage insurance business, although the holding company may be a diversified insurer), many of our insurers and reinsurers in these transactions participate in multiple types of insurance business, which helps diversify their risk exposure.

Other Investments Counterparties

We are exposed to the non-performance of counterparties relating to other investments (including non-mortgage-related securities and cash equivalents) transactions, including those entered into on behalf of our securitization trusts. Our policies require that the counterparty be evaluated using our internal counterparty rating model prior to our entering into such transactions. We monitor the financial strength of our counterparties to these transactions and may use collateral maintenance requirements to manage our exposure to individual counterparties. The permitted term and dollar limits for each of these transactions are also based on the counterparty's financial strength.

Our other investments (including non-mortgage-related securities and cash equivalents) counterparties are primarily major financial institutions, including other GSEs, Treasury, the Federal Reserve Bank of New York, GSD/FICC, highly-rated supranational institutions, depository and non-depository institutions, brokers and dealers, and government money market funds. As of September 30, 2019 and December 31, 2018, including amounts related to our consolidated VIEs, the balance in our other investments was $89.6 billion and $63.1 billion, respectively. The balances consist primarily of cash and securities purchased under agreements to resell invested with counterparties, U.S. Treasury securities, cash deposited with the Federal Reserve Bank of New York, and secured lending activities. As of September 30, 2019, all of our securities purchased under agreements to resell were fully collateralized. As of September 30, 2019 and December 31, 2018, $2.2 billion and $2.5 billion of our securities purchased under agreements to resell were used to provide financing to investors in Freddie Mac securities to increase liquidity and expand the investor base for those securities. These transactions differ from the securities purchased under agreements to resell that we use for liquidity purposes as the counterparties we face may not be major financial institutions and we are exposed to the counterparty risk of these institutions.

Freddie Mac Form 10-Q 104

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

NOTE 15

Fair Value Disclosures

The accounting guidance for fair value measurements and disclosures defines fair value, establishes a framework for measuring fair value, and sets forth disclosure requirements regarding fair value measurements. This guidance applies whenever other accounting guidance requires or permits assets or liabilities to be measured at fair value. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurement assumes that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or, in the absence of a principal market, in the most advantageous market for the asset or liability.

We use fair value measurements for the initial recording of certain assets and liabilities and periodic remeasurement of certain assets and liabilities on a recurring or non-recurring basis.

Fair Value Measurements

The accounting guidance for fair value measurements and disclosures establishes a three-level fair value hierarchy that prioritizes the inputs into the valuation techniques used to measure fair value. The levels of the fair value hierarchy are defined as follows in priority order:

n Level 1 - inputs to the valuation techniques are based on quoted prices in active markets for identical assets or liabilities.

n Level 2 - inputs to the valuation techniques are based on observable inputs other than quoted prices in active markets for identical assets or liabilities.

n Level 3 - one or more inputs to the valuation technique are unobservable and significant to the fair value measurement.

We use quoted market prices and valuation techniques that seek to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs. Our inputs are based on the assumptions a market participant would use in valuing the asset or liability. Assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The tables below present our assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis subsequent to initial recognition, including instruments where we have elected the fair value option.

Freddie Mac Form 10-Q 105

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

Table 15.1 - Assets and Liabilities Measured at Fair Value on a Recurring Basis

	September 30, 2019
(In millions)	Level 1		Level 2		Level 3		Netting Adjustment(1)			Total
Assets:
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$—		$23,969		$2,150		$—			$26,119
Other agency	—		992		34		—			1,026
Non-agency and other	—		21		1,367		—			1,388
Total available-for-sale securities, at fair value	—		24,982		3,551		—			28,533
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	—		10,042		2,930		—			12,972
Other agency	—		7,189		5		—			7,194
All other	—		—		1		—			1
Total mortgage-related securities	—		17,231		2,936		—			20,167
Non-mortgage-related securities	21,952		2,330		—		—			24,282
Total trading securities, at fair value	21,952		19,561		2,936		—			44,449
Total investments in securities	21,952		44,543		6,487		—			72,982
Mortgage loans:
Held-for-sale, at fair value	—		21,538		—		—			21,538
Derivative assets, net:
Interest-rate swaps	—		2,504		—		—			2,504
Option-based derivatives	—		5,196		—		—			5,196
Other	—		192		16		—			208
Subtotal, before netting adjustments	—		7,892		16		—			7,908
Netting adjustments(1)	—		—		—		(6,316		)	(6,316		)
Total derivative assets, net	—		7,892		16		(6,316		)	1,592
Other assets:
Guarantee asset, at fair value	—		—		4,225		—			4,225
Non-derivative held-for-sale purchase commitments, at fair value	—		223		—		—			223
All other, at fair value	—		—		142		—			142
Total other assets	—		223		4,367		—			4,590
Total assets carried at fair value on a recurring basis		$21,952		$74,196		$10,870		($6,316	)		$100,702
Liabilities:
Debt securities of consolidated trusts held by third parties, at fair value		$—		$4		$733		$—			$737
Other debt, at fair value	—		3,733		130		—			3,863
Derivative liabilities, net:
Interest-rate swaps	—		6,102		—		—			6,102
Option-based derivatives	—		78		—		—			78
Other	—		257		40		—			297
Subtotal, before netting adjustments	—		6,437		40		—			6,477
Netting adjustments(1)	—		—		—		(6,122		)	(6,122		)
Total derivative liabilities, net	—		6,437		40		(6,122		)	355
Other liabilities:
Non-derivative held-for-sale purchase commitments, at fair value	—		1		—		—			1
All other, at fair value	—		—		2		—			2
Total liabilities carried at fair value on a recurring basis		$—		$10,175		$905		($6,122	)		$4,958

Referenced footnote is included after the next table.

Freddie Mac Form 10-Q 106

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

	December 31, 2018
(In millions)	Level 1		Level 2		Level 3		Netting Adjustment(1)			Total
Assets:
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$—		$26,102		$4,097		$—			$30,199
Other agency	—		1,668		38		—			1,706
Non-agency and other	—		18		1,640		—			1,658
Total available-for-sale securities, at fair value	—		27,788		5,775		—			33,563
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	—		10,535		3,286		—			13,821
Other agency	—		2,544		7		—			2,551
All other	—		—		1		—			1
Total mortgage-related securities	—		13,079		3,294		—			16,373
Non-mortgage-related securities	15,885		3,290		—		—			19,175
Total trading securities, at fair value	15,885		16,369		3,294		—			35,548
Total investments in securities	15,885		44,157		9,069		—			69,111
Mortgage loans:
Held-for-sale, at fair value	—		23,106		—		—			23,106
Derivative assets, net:
Interest-rate swaps	—		2,127		—		—			2,127
Option-based derivatives	—		4,200		—		—			4,200
Other	—		90		1		—			91
Subtotal, before netting adjustments	—		6,417		1		—			6,418
Netting adjustments(1)	—		—		—		(6,083		)	(6,083		)
Total derivative assets, net	—		6,417		1		(6,083		)	335
Other assets:
Guarantee asset, at fair value	—		—		3,633		—			3,633
Non-derivative held-for-sale purchase commitments, at fair value	—		159		—		—			159
All other, at fair value	—		—		137		—			137
Total other assets	—		159		3,770		—			3,929
Total assets carried at fair value on a recurring basis		$15,885		$73,839		$12,840		($6,083	)		$96,481
Liabilities:
Debt securities of consolidated trusts held by third parties, at fair value		$—		$27		$728		$—			$755
Other debt, at fair value	—		4,223		134		—			4,357
Derivative liabilities, net:
Interest-rate swaps	—		3,974		—		—			3,974
Option-based derivatives	—		137		—		—			137
Other	—		225		92		—			317
Subtotal, before netting adjustments	—		4,336		92		—			4,428
Netting adjustments(1)	—		—		—		(3,845		)	(3,845		)
Total derivative liabilities, net	—		4,336		92		(3,845		)	583
Other liabilities:
Non-derivative held-for-sale purchase commitments, at fair value	—		17		—		—			17
Total liabilities carried at fair value on a recurring basis		$—		$8,603		$954		($3,845	)		$5,712

(1) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

Freddie Mac Form 10-Q 107

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

Level 3 Fair Value Measurements

The tables below present a reconciliation of all assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis using significant unobservable inputs (Level 3), including transfers into and out of Level 3. The tables also present gains and losses due to changes in fair value, including both realized and unrealized gains and losses, recognized on our condensed consolidated statements of comprehensive income for Level 3 assets and liabilities.

Table 15.2 - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs

	3Q 2019
	Balance, July 1, 2019		Realized and unrealized gains (losses)									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$2,744		$23			$16			$39			$—		$—		($531	)		($102	)		$—		$—			$2,150		$1
Other agency	36		—			—			—			—		—		—			(2		)	—		—			34		—
Non-agency and other	1,494		26			(10		)	16			—		—		(87		)	(56		)	—		—			1,367		3
Total available-for-sale mortgage-related securities	4,274		49			6			55			—		—		(618		)	(160		)	—		—			3,551		4
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,028		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,930		(31		)
Other agency	5		—			—			—			—		—		—			—			—		—			5		—
All other	1		—			—			—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,034		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,936		(31		)
Other assets:
Guarantee asset	3,941		15			—			15			—		439		—			(170		)	—		—			4,225		15
All other, at fair value	126		12			—			12			24		12		(27		)	(5		)	—		—			142		(3		)
Total other assets		$4,067		$27			$—			$27			$24		$451		($27	)		($175	)		$—		$—			$4,367		$12
	Balance, July 1, 2019		Realized and unrealized (gains) losses									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733		$—			$—			$—			$—		$—		$—			$—			$—		$—			$733		$—
Other debt, at fair value	129		—			—			—			2		—		—			(1		)	—		—			130		—
Net derivatives(2)	40		(8		)	—			(8		)	—		—		—			(8		)	—		—			24		(13		)
All other, at fair value	—		2			—			2			2		—		(2		)	—			—		—			2		—

Referenced footnotes are included after the prior period tables.

Freddie Mac Form 10-Q 108

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

	YTD 2019
	Balance, January 1, 2019		Realized and unrealized gains (losses)								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income		Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$4,097		$13			$115		$128			$202		$—		($1,724	)		($290	)		$—		($263	)		$2,150		$2
Other agency	38		—			1		1			—		—		—			(5		)	—		—			34		—
Non-agency and other	1,640		52			25		77			—		—		(174		)	(176		)	—		—			1,367		12
Total available-for-sale mortgage-related securities	5,775		65			141		206			202		—		(1,898		)	(471		)	—		(263		)	3,551		14
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,286		(113		)	—		(113		)	1,242		—		(730		)	95			8		(858		)	2,930		(68		)
Other agency	7		—			—		—			—		—		(2		)	—			—		—			5		(1		)
All other	1		—			—		—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,294		(113		)	—		(113		)	1,242		—		(732		)	95			8		(858		)	2,936		(69		)
Other assets:
Guarantee asset	3,633		75			—		75			—		1,005		—			(488		)	—		—			4,225		75
All other, at fair value	137		(31		)	—		(31		)	75		29		(59		)	(9		)	—		—			142		(51		)
Total other assets		$3,770		$44			$—		$44			$75		$1,034		($59	)		($497	)		$—		$—			$4,367		$24
	Balance, January 1, 2019		Realized and unrealized (gains) losses								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income		Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728		$5			$—		$5			$—		$—		$—			$—			$—		$—			$733		$5
Other debt, at fair value	134		—			—		—			—		2		—			(6		)	—		—			130		—
Net derivatives(2)	91		(54		)	—		(54		)	—		—		—			(13		)	—		—			24		(66		)
All other, at fair value	—		—			—		—			4		—		(2		)	—			—		—			2		(2		)

Referenced footnotes are included after the prior period tables.

Freddie Mac Form 10-Q 109

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

	3Q 2018
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,004		($3	)		($68	)		($71	)		$684			$—			($237	)		($199	)		$—		($91	)		$6,090		($4	)
Other agency	270		—			—			—			—			—			—			(2		)	—		(228		)	40		—
Non-agency and other	2,535		383			(66		)	317			—			—			(660		)	(134		)	—		—			2,058		10
Total available-for-sale mortgage-related securities	8,809		380			(134		)	246			684			—			(897		)	(335		)	—		(319		)	8,188		6
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,711		(140		)	—			(140		)	623			—			(875		)	(31		)	—		(108		)	3,180		(136		)
Other agency	17		(1		)	—			(1		)	—			—			—			1			—		—			17		(1		)
All other	1		—			—			—			—			—			—			—			—		—			1		—
Total trading mortgage-related securities	3,729		(141		)	—			(141		)	623			—			(875		)	(30		)	—		(108		)	3,198		(137		)
Other assets:
Guarantee asset	3,363		(28		)	—			(28		)	—			255			—			(147		)	—		—			3,443		(28		)
All other, at fair value	103		1			—			1			(3		)	(11		)	—			—			—		—			90		(4		)
Total other assets		$3,466		($27	)		$—			($27	)		($3	)		$244			$—			($147	)		$—		$—			$3,533		($32	)
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$629		($1	)		$—			($1	)		$—			$100			$—			$—			$—		$—			$728		($1	)
Other debt, at fair value	135		—			—			—			—			—			—			(1		)	—		—			134		—
Net derivatives(2)	42		8			—			8			—			41			—			(4		)	—		—			87		3

Referenced footnotes are included after the following table.

Freddie Mac Form 10-Q 110

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

	YTD 2018
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,751		($13	)		($267	)		($280	)		$684		$—			($293	)		($772	)		$—		$—			$6,090		($13	)
Other agency	46		—			(1		)	(1		)	—		—			—			(5		)	—		—			40		—
Non-agency and other	4,291		876			(538		)	338			—		—			(2,160		)	(411		)	—		—			2,058		31
Total available-for-sale mortgage-related securities	11,088		863			(806		)	57			684		—			(2,453		)	(1,188		)	—		—			8,188		18
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	2,907		(383		)	—			(383		)	1,027		—			(863		)	(55		)	579		(32		)	3,180		(362		)
Other agency	9		(2		)	—			(2		)	30		—			(21		)	1			—		—			17		(2		)
All other	1		—			—			—			—		—			—			—			—		—			1		—
Total trading mortgage-related securities	2,917		(385		)	—			(385		)	1,057		—			(884		)	(54		)	579		(32		)	3,198		(364		)
Other assets:
Guarantee asset	3,171		(48		)	—			(48		)	—		745			—			(425		)	—		—			3,443		(48		)
All other, at fair value	45		31			—			31			38		(24		)	—			—			—		—			90		11
Total other assets		$3,216		($17	)		$—			($17	)		$38		$721			$—			($425	)		$—		$—			$3,533		($37	)
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$630		($2	)		$—			($2	)		$—		$100			$—			$—			$—		$—			$728		($2	)
Other debt, at fair value	137		—			—			—			—		—			—			(3		)	—		—			134		—
Net derivatives(2)	57		28			—			28			—		15			—			(13		)	—		—			87		15

(1) Transfers out of Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to an increased volume and level of activity in the market and availability of price quotes from dealers and third-party pricing services. Certain Freddie Mac securities are classified as Level 3 at issuance and generally are classified as Level 2 when they begin trading. Transfers into Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to a decrease in market activity and the availability of relevant price quotes from dealers and third-party pricing services.

(2) Amounts are the net of derivative assets and liabilities prior to counterparty netting, cash collateral netting, net trade/settle receivable or payable, and net derivative interest receivable or payable.

(3) Represents the amount of total gains or losses for the period, included in earnings, attributable to the change in unrealized gains and losses related to assets and liabilities classified as Level 3 that were still held at September 30, 2019 and September 30, 2018, respectively. Included in these amounts are other-than temporary impairments recorded on available-for-sale securities.

Freddie Mac Form 10-Q 111

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

The tables below provide valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 3 assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis.

Table 15.3 - Quantitative Information about Recurring Level 3 Fair Value Measurements

	September 30, 2019
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Assets
Available-for-sale, at fair value
Mortgage-related securities
Freddie Mac		$2,150	Discounted cash flows	OAS	30 - 261 bps	81 bps
Non-agency and other	979		Median of external sources	External pricing sources	$70.3 - $76.7		$73.5
	388		Other
Trading, at fair value
Mortgage-related securities
Freddie Mac	2,047		Single external source	External pricing sources	$0.0 - $102.4		$36.1
	883		Discounted cash flows	OAS	(831) - 8,095 bps	555 bps
Guarantee asset, at fair value	3,970		Discounted cash flows	OAS	17-186 bps	43 bps
	255		Other
Insignificant Level 3 assets(1)	182
Total level 3 assets		$10,854
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733	Single External Source	External Pricing Sources	$99.5 - $103.9		$100.4
Insignificant Level 3 liabilities(1)	156

Referenced footnote is included after the next table.

Freddie Mac Form 10-Q 112

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

	December 31, 2018
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Assets
Available-for-sale, at fair value
Mortgage-related securities
Freddie Mac		$2,838	Discounted cash flows	OAS	30 - 325 bps	81 bps
	1,259		Single external source	External pricing sources	$96.1 - $104.1		$102.3
Non-agency and other	1,403		Median of external sources	External pricing sources	$64.3 - $71.1		$67.3
	237		Single external source	External pricing sources	$93.1 - $110.7		$100.7
Trading, at fair value
Mortgage-related securities
Freddie Mac	1,587		Single external source	External pricing sources	$0.0 - $99.2		$56.6
	1,178		Discounted cash flows	OAS	(21,945) - 6,639 bps	90 bps
	521		Other
Guarantee asset, at fair value	3,391		Discounted cash flows	OAS	17-198 bps	49 bps
	242		Other
Insignificant Level 3 assets(1)	184
Total level 3 assets		$12,840
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728	Single External Source	External Pricing Sources	$97.4 - $101.1		$99.6
Insignificant Level 3 liabilities(1)	226

(1) Represents the aggregate amount of Level 3 assets or liabilities measured at fair value on a recurring basis that are individually and in the aggregate insignificant.

Freddie Mac Form 10-Q 113

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

Assets Measured at Fair Value on a Non-Recurring Basis

We may be required, from time to time, to measure certain assets at fair value on a non-recurring basis. These adjustments usually result from the application of lower-of-cost-or-fair-value accounting or measurement of impairment based on the fair value of the underlying collateral. Certain of the fair values in the tables below were not obtained as of the period end, but were obtained during the period.

The table below presents assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 15.4 - Assets Measured at Fair Value on a Non-Recurring Basis

September 30, 2019

December 31, 2018

(In millions)

Level 1

Level 2

Level 3

Total

Level 1

Level 2

Level 3

Total

Assets measured at fair value on a non-recurring basis:

Mortgage loans(1)

$—

$429

$3,301

$3,730

$—

$24

$7,519

$7,543

(1) Includes loans that are classified as held-for-investment and have been measured for impairment based on the fair value of the underlying collateral and held-for-sale loans where the fair value is below cost.

The tables below provide valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 3 assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 15.5 - Quantitative Information about Non-Recurring Level 3 Fair Value Measurements

	September 30, 2019
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Non-recurring fair value measurements
Mortgage loans		$3,301
			Internal model	Historical sales proceeds	$3,110 - $671,825	$185,551
			Internal model	Housing sales index	45 - 352 bps	113 bps
			Median of external sources	External pricing sources	$30.4 - $95.0	$85.1
	December 31, 2018
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Non-recurring fair value measurements
Mortgage loans		$7,519
			Internal model	Historical sales proceeds	$3,000 - $750,500	$177,725
			Internal model	Housing sales index	44 - 480 bps	108 bps
			Median of external sources	External pricing sources	$36.2 - $94.6	$82.5

Freddie Mac Form 10-Q 114

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

Fair Value of Financial Instruments

The tables below present the carrying value and estimated fair value of our financial instruments. For certain types of financial instruments, such as cash and cash equivalents, securities purchased under agreements to resell, secured lending and other, and certain debt, the carrying value on our GAAP balance sheets approximates fair value, as these assets and liabilities are short-term in nature and have limited fair value volatility.

Table 15.6 - Fair Value of Financial Instruments

		September 30, 2019
	GAAP Measurement Category(1)	GAAP Carrying  Amount		Fair Value
(In millions)				Level 1		Level 2		Level 3		Netting  Adjustments(2)			Total
Financial Assets
Cash and cash equivalents	Amortized cost		$8,708		$8,693		$15		$—		$—			$8,708
Securities purchased under agreements to resell	Amortized cost	51,187		—		51,187		—		—			51,187
Investments in securities:
Available-for-sale, at fair value	FV - OCI	28,533		—		24,982		3,551		—			28,533
Trading, at fair value	FV - NI	44,449		21,952		19,561		2,936		—			44,449
Total investments in securities		72,982		21,952		44,543		6,487		—			72,982
Mortgage loans:
Loans held by consolidated trusts		1,905,633		—		1,714,292		223,324		—			1,937,616
Loans held by Freddie Mac		91,857		—		46,636		48,517		—			95,153
Total mortgage loans	Various(3)	1,997,490		—		1,760,928		271,841		—			2,032,769
Derivative assets, net	FV - NI	1,592		—		7,892		16		(6,316		)	1,592
Guarantee asset	FV - NI	4,225		—		—		4,233		—			4,233
Non-derivative purchase commitments, at fair value	FV - NI	223		—		229		1		—			230
Secured lending and other	Amortized cost	5,439		—		1,728		2,745		—			4,473
Total financial assets			$2,141,846		$30,645		$1,866,522		$285,323		($6,316	)		$2,176,174
Financial Liabilities
Debt, net:
Debt securities of consolidated trusts held by third parties			$1,869,308		$—		$1,898,887		$2,068		$—			$1,900,955
Other debt		279,951		—		281,229		3,757		—			284,986
Total debt, net	Various(4)	2,149,259		—		2,180,116		5,825		—			2,185,941
Derivative liabilities, net	FV - NI	355		—		6,437		40		(6,122		)	355
Guarantee obligation	Amortized cost	4,055		—		—		4,416		—			4,416
Non-derivative purchase commitments, at fair value	FV - NI	1		—		1		12		—			13
Total financial liabilities			$2,153,670		$—		$2,186,554		$10,293		($6,122	)		$2,190,725

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

(3) As of September 30, 2019, the GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $2.0 trillion, $19.6 billion, and $21.5 billion, respectively.

(4) As of September 30, 2019, the GAAP carrying amounts measured at amortized cost and FV - NI were $2.1 trillion and $4.6 billion, respectively.

Freddie Mac Form 10-Q 115

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

		December 31, 2018
	GAAP Measurement Category(1)	GAAP Carrying  Amount		Fair Value
(In millions)				Level 1		Level 2		Level 3		Netting Adjustments(2)			Total
Financial Assets
Cash and cash equivalents	Amortized cost		$7,273		$7,273		$—		$—		$—			$7,273
Securities purchased under agreements to resell	Amortized cost	34,771		—		34,771		—		—			34,771
Investments in securities:
Available-for-sale, at fair value	FV - OCI	33,563		—		27,788		5,775		—			33,563
Trading, at fair value	FV - NI	35,548		15,885		16,369		3,294		—			35,548
Total investments in securities		69,111		15,885		44,157		9,069		—			69,111
Mortgage loans:
Loans held by consolidated trusts		1,842,850		—		1,605,874		209,542		—			1,815,416
Loans held by Freddie Mac		84,128		—		33,946		52,212		—			86,158
Total mortgage loans	Various(3)	1,926,978		—		1,639,820		261,754		—			1,901,574
Derivative assets, net	FV - NI	335		—		6,417		1		(6,083		)	335
Guarantee asset	FV - NI	3,633		—		—		3,642		—			3,642
Non-derivative purchase commitments, at fair value	FV - NI	159		—		159		2		—			161
Secured lending and other	Amortized cost	1,805		—		195		873		—			1,068
Total financial assets			$2,044,065		$23,158		$1,725,519		$275,341		($6,083	)		$2,017,935
Financial Liabilities
Debt, net:
Debt securities of consolidated trusts held by third parties			$1,792,677		$—		$1,759,911		$2,698		$—			$1,762,609
Other debt		252,273		—		251,543		3,629		—			255,172
Total debt, net	Various(4)	2,044,950		—		2,011,454		6,327		—			2,017,781
Derivative liabilities, net	FV - NI	583		—		4,336		92		(3,845		)	583
Guarantee obligation	Amortized cost	3,561		—		—		4,146		—			4,146
Non-derivative purchase commitments, at fair value	FV - NI	17		—		17		11		—			28
Total financial liabilities			$2,049,111		$—		$2,015,807		$10,576		($3,845	)		$2,022,538

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

(3) As of December 31, 2018, the GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $1.9 trillion, $18.5 billion, and $23.1 billion, respectively.

(4) As of December 31, 2018, the GAAP carrying amounts measured at amortized cost and FV - NI were $2.0 trillion and $5.1 billion, respectively.

Fair Value Option

We elected the fair value option for certain multifamily held-for-sale loans, multifamily held-for-sale loan purchase commitments, and long-term debt.

The table below presents the fair value and UPB related to certain loans and long-term debt for which we have elected the fair value option. This table does not include interest-only securities related to debt securities of consolidated trusts and other debt held by third parties with a fair value of $61 million and $26 million and multifamily held-for-sale loan purchase commitments with a fair value of $222 million and $142 million, as of September 30, 2019 and December 31, 2018, respectively.

Freddie Mac Form 10-Q 116

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 15

Table 15.7 - Difference between Fair Value and UPB for Certain Financial Instruments with Fair Value Option Elected

	September 30, 2019						December 31, 2018
(In millions)	Multifamily Held-For-Sale  Loans		Other Debt - Long Term		Debt Securities Of Consolidated Trusts Held By Third Parties		Multifamily Held-For-Sale  Loans		Other Debt - Long Term		Debt Securities Of Consolidated Trusts Held By Third Parties
Fair value		$21,538		$3,806		$733		$23,106		$4,357		$728
UPB	20,152		3,538		730		22,693		3,998		730
Difference		$1,386		$268		$3		$413		$359		($2	)

Changes in Fair Value Under the Fair Value Option Election

The table below presents the changes in fair value included in non-interest income (loss) in our condensed consolidated statements of comprehensive income, related to items for which we have elected the fair value option.

Table 15.8 - Changes in Fair Value Under the Fair Value Option Election

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(In millions)	Gains (Losses)						Gains (Losses)
Multifamily held-for-sale loans		$398			($285	)		$1,216			($797	)
Multifamily held-for-sale loan purchase commitments	641			267			1,644			564
Other debt - long term	49			10			116			38
Debt securities of consolidated trusts held by third parties	(1		)	2			(6		)	4

Changes in fair value attributable to instrument-specific credit risk were not material for 3Q 2019 and YTD 2019 and for 3Q 2018 and YTD 2018 for any assets or liabilities for which we elected the fair value option.

Freddie Mac Form 10-Q 117

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 16

NOTE 16

Legal Contingencies

We are involved as a party in a variety of legal and regulatory proceedings arising from time to time in the ordinary course of business including, among other things, contractual disputes, personal injury claims, employment-related litigation, and other legal proceedings incidental to our business. We are frequently involved, directly or indirectly, in litigation involving mortgage foreclosures. From time to time, we are also involved in proceedings arising from our termination of a seller's or servicer's eligibility to sell loans to, and/or service loans for, us. In these cases, the former seller or servicer sometimes seeks damages against us for wrongful termination under a variety of legal theories. In addition, we are sometimes sued in connection with the origination or servicing of loans. These suits typically involve claims alleging wrongful actions of sellers and servicers. Our contracts with our sellers and servicers generally provide for indemnification of Freddie Mac against liability arising from sellers' and servicers' wrongful actions with respect to loans sold to or serviced for Freddie Mac.

Litigation and claims resolution are subject to many uncertainties and are not susceptible to accurate prediction. In accordance with the accounting guidance for contingencies, we reserve for litigation claims and assessments asserted or threatened against us when a loss is probable (as defined in such guidance) and the amount of the loss can be reasonably estimated.

Putative Securities Class Action Lawsuit: Ohio Public Employees Retirement System vs. Freddie Mac, Syron, Et Al.

This putative securities class action lawsuit was filed against Freddie Mac and certain former officers on January 18, 2008 in the U.S. District Court for the Northern District of Ohio purportedly on behalf of a class of purchasers of Freddie Mac stock from August 1, 2006 through November 20, 2007. FHFA later intervened as Conservator, and the plaintiff amended its complaint on several occasions. The plaintiff alleged, among other things, that the defendants violated federal securities laws by making false and misleading statements concerning our business, risk management, and the procedures we put into place to protect the company from problems in the mortgage industry. The plaintiff seeks unspecified damages and interest, and reasonable costs and expenses, including attorney and expert fees.

In October 2013, defendants filed motions to dismiss the complaint. In October 2014, the District Court granted defendants' motions and dismissed the case in its entirety against all defendants, with prejudice. In November 2014, plaintiff filed a notice of appeal in the U.S. Court of Appeals for the Sixth Circuit. On July 20, 2016, the Court of Appeals reversed the District Court's dismissal and remanded the case to the District Court for further proceedings. On August 14, 2018, the District Court denied the plaintiff's motion for class certification. On January 23, 2019, the Court of Appeals denied plaintiff's petition for leave to appeal that decision.

At present, it is not possible for us to predict the probable outcome of this lawsuit or any potential effect on our business, financial condition, liquidity, or results of operations. In addition, we are unable to reasonably estimate the possible loss or range of possible loss in the event of an adverse judgment in the foregoing matter due to the following factors, among others: pre-trial litigation is inherently uncertain; while the District Court denied plaintiff's motion for class certification, this denial may be appealed upon the entry of final judgment; and the District Court has not yet ruled upon motions for summary judgment. In particular, absent a final resolution of whether a class will be certified, the identification of a class if one is certified, and the identification of the alleged statement or statements that survive dispositive motions, we cannot reasonably estimate any possible loss or range of possible loss.

LIBOR Lawsuit

On March 14, 2013, Freddie Mac filed a lawsuit in the U.S. District Court for the Eastern District of Virginia against the British Bankers Association and the 16 U.S. Dollar LIBOR panel banks and a number of their affiliates. The case was subsequently transferred to the U.S. District Court for the Southern District of New York. The complaint alleges, among other things, that the defendants fraudulently and collusively depressed LIBOR, a benchmark interest rate indexed to trillions of dollars of financial products, and asserts claims for antitrust violations, breach of contract, tortious interference with contract, and fraud. Freddie Mac filed an amended complaint in July 2013, and a second amended complaint in October 2014. In August 2015, the District Court dismissed the portion of our claim related to antitrust violations and fraud and we filed a motion for reconsideration. On March 31, 2016, the District Court granted a portion of our motion, finding personal jurisdiction over certain defendants, and denied the portion of our motion with respect to statutes of limitation for our fraud claims. Subsequently, in a related case, the U.S. Court of Appeals for the Second Circuit reversed the District Court's dismissal of certain plaintiffs' antitrust claims and remanded the case to the District Court for consideration of whether, among other things, the plaintiffs are "efficient enforcers" of the antitrust laws.

Freddie Mac Form 10-Q 118

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 16

On December 20, 2016, after briefing and argument on the defendants' renewed motions to dismiss on personal jurisdiction and efficient enforcer grounds, the District Court denied defendants' motions in part and granted them in part. The District Court held that Freddie Mac is an efficient enforcer of the antitrust laws, but dismissed on personal jurisdiction grounds Freddie Mac's antitrust claims against all defendants except HSBC USA, N.A. Then, in an order issued February 2, 2017, the District Court effectively dismissed Freddie Mac's remaining antitrust claim against HSBC USA, N.A. At present, Freddie Mac's breach of contract actions against Bank of America, N.A., Barclays Bank, Citibank, N.A., Credit Suisse, Deutsche Bank, Royal Bank of Scotland, and UBS AG are its only claims remaining in the District Court.

On February 23, 2018, the Second Circuit reversed the District Court's dismissal of certain plaintiffs' state law fraud and unjust enrichment claims on statutes of limitations grounds. While Freddie Mac was not a party to the appeal, this decision could have the effect of reinstating Freddie Mac's fraud claims against the above-named defendants. The Second Circuit also reversed certain aspects of the District Court's personal jurisdiction rulings and remanded with instructions to allow the named appellant to amend its complaint. The District Court subsequently granted in part Freddie Mac's motion for leave to amend its complaint, and Freddie Mac amended its complaint on April 16, 2019.

Litigation Concerning the Purchase Agreement

Since July 2013, a number of lawsuits have been filed against us concerning the August 2012 amendment to the Purchase Agreement, which created the net worth sweep dividend provisions of the senior preferred stock. The plaintiffs in the lawsuits allege that they are holders of common stock and/or junior preferred stock issued by Freddie Mac and Fannie Mae. (For purposes of this discussion, junior preferred stock refers to the various series of preferred stock of Freddie Mac and Fannie Mae other than the senior preferred stock issued to Treasury.) It is possible that similar lawsuits will be filed in the future. The lawsuits against us are described below.

Litigation in the U.S. District Court for the District of Columbia

In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations. This case is the result of the consolidation of three putative class action lawsuits: Cacciapelle and Bareiss vs. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation and FHFA, filed on July 29, 2013; American European Insurance Company vs. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation and FHFA, filed on July 30, 2013; and Marneu Holdings, Co. vs. FHFA, Treasury, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation, filed on September 18, 2013. (The Marneu case was also filed as a shareholder derivative lawsuit.) A consolidated amended complaint was filed in December 2013. In the consolidated amended complaint, plaintiffs allege, among other items, that the August 2012 amendment to the Purchase Agreement breached Freddie Mac's and Fannie Mae's respective contracts with the holders of junior preferred stock and common stock and the covenant of good faith and fair dealing inherent in such contracts. Plaintiffs sought unspecified damages, equitable and injunctive relief, and costs and expenses, including attorney and expert fees.

The Cacciapelle and American European Insurance Company lawsuits were filed purportedly on behalf of a class of purchasers of junior preferred stock issued by Freddie Mac or Fannie Mae who held stock prior to, and as of, August 17, 2012. The Marneu lawsuit was filed purportedly on behalf of a class of purchasers of junior preferred stock and purchasers of common stock issued by Freddie Mac or Fannie Mae over a not-yet-defined period of time.

Arrowood Indemnity Company vs. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, FHFA, and Treasury. This case was filed on September 20, 2013. The allegations and demands made by plaintiffs in this case were generally similar to those made by the plaintiffs in the In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations case described above. Plaintiffs in the Arrowood lawsuit also requested that, if injunctive relief were not granted, the Arrowood plaintiffs be awarded damages against the defendants in an amount to be determined including, but not limited to, the aggregate par value of their junior preferred stock, the total of which they stated to be approximately $42 million.

American European Insurance Company, Cacciapelle, and Miller vs. Treasury and FHFA. This case was filed as a shareholder derivative lawsuit, purportedly on behalf of Freddie Mac as a "nominal" defendant, on July 30, 2014. The complaint alleged that, through the August 2012 amendment to the Purchase Agreement, Treasury and FHFA breached their respective fiduciary duties to Freddie Mac, causing Freddie Mac to suffer damages. The plaintiffs asked that Freddie Mac be awarded compensatory damages and disgorgement, as well as attorneys' fees, costs, and other expenses.

FHFA, joined by Freddie Mac and Fannie Mae, moved to dismiss the In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations case and the other related cases in January 2014. Treasury filed a motion to dismiss the same day. In September 2014, the District Court granted the motions and dismissed the plaintiffs' claims. All plaintiffs appealed that decision, and on February 21, 2017, the U.S. Court of Appeals for the District of Columbia Circuit affirmed in part and remanded in part the decision granting the motions to dismiss. The Court of Appeals affirmed dismissal of all claims except certain claims seeking monetary damages for breach of contract and breach of implied duty of good faith and fair dealing. In March 2017, certain institutional and class plaintiffs filed petitions for panel rehearing with respect to certain

Freddie Mac Form 10-Q 119

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 16

claims. On July 17, 2017, the Court of Appeals granted the petitions for rehearing and issued a modified decision, which permitted the institutional plaintiffs to pursue the breach of contract and breach of implied duty of good faith and fair dealing claims that had been remanded. The Court of Appeals also removed language related to the standard to be applied to the implied duty claims, leaving that issue for the District Court to determine on remand. On October 16, 2017, certain institutional and class plaintiffs filed petitions for a writ of certiorari in the U.S. Supreme Court challenging whether HERA's prohibition on injunctive relief against FHFA bars judicial review of the net worth sweep dividend provisions of the August 2012 amendment to the Purchase Agreement, as well as whether HERA bars shareholders from pursuing derivative litigation where they allege the conservator faces a conflict of interest. The Supreme Court denied the petitions on February 20, 2018. On November 1, 2017, certain institutional and class plaintiffs and plaintiffs in another case in which Freddie Mac was not originally a defendant, Fairholme Funds, Inc. v. FHFA, Treasury, and Federal National Mortgage Association, filed proposed amended complaints in the District Court. Each of the proposed amended complaints names Freddie Mac as a defendant for breach of contract and breach of the covenant of good faith and fair dealing claims as well as for new claims alleging breach of fiduciary duty and breach of Virginia corporate law. On January 10, 2018, FHFA, Freddie Mac, and Fannie Mae moved to dismiss the amended complaints. On September 28, 2018, the District Court dismissed all of the claims except those alleging breach of the implied covenant of good faith and fair dealing. Discovery is ongoing.

Angel vs. The Federal Home Loan Mortgage Corporation et al. This case was filed pro se on May 21, 2018 against Freddie Mac, Fannie Mae, certain current and former directors of Freddie Mac and Fannie Mae, and FHFA as a nominal defendant. The complaint alleged, among other things, breach of contract, breach of the implied covenant of good faith and fair dealing, and that defendants aided and abetted the government's "avoidance" of plaintiff's dividend rights. On March 6, 2019, the U.S. District Court for the District of Columbia granted the defendants' motion to dismiss the case. On March 18, 2019, Mr. Angel filed a motion seeking to alter or amend the judgment and for leave to file an amended complaint. On May 24, 2019, the District Court denied Mr. Angel's motion, and on June 19, 2019, Mr. Angel filed a notice of appeal to the U.S. Court of Appeals for the District of Columbia Circuit.

Litigation in the U.S. Court of Federal Claims

Reid and Fisher vs. the United States of America and Federal Home Loan Mortgage Corporation. This case was filed as a derivative lawsuit, purportedly on behalf of Freddie Mac as a "nominal" defendant, on February 26, 2014. The complaint alleges, among other items, that the net worth sweep dividend provisions of the senior preferred stock constitute an unlawful taking of private property for public use without just compensation. The plaintiffs ask that Freddie Mac be awarded just compensation for the U.S. government's alleged taking of its property, attorneys' fees, costs, and other expenses. On March 8, 2018, the plaintiffs filed an amended complaint under seal, with a redacted copy filed on November 14, 2018. Defendants filed a motion to dismiss on August 1, 2018 and an amended motion to dismiss on October 1, 2018.

Fairholme Funds, Inc., et al. vs. the United States of America, Federal National Mortgage Association, and Federal Home Loan Mortgage Corporation. This case was originally filed on July 9, 2013 against the United States of America. On March 8, 2018, plaintiffs filed an amended complaint under seal. A redacted public version was filed on May 11, 2018 and adds Freddie Mac and Fannie Mae as nominal defendants. The amended complaint alleges, among other items, that the net worth sweep dividend provisions of the senior preferred stock constitute an unlawful taking or exaction of private property for public use without just compensation, and that by enacting the net worth sweep, the government breached the fiduciary duty it owed to Freddie Mac and Fannie Mae, and implied-in-fact contracts between the United States on the one hand and Freddie Mac and Fannie Mae on the other. The plaintiffs ask that plaintiffs, Freddie Mac, and Fannie Mae be awarded (1) just compensation for the government's alleged taking or exaction of their property, (2) damages for the government's breach of fiduciary duties, and (3) damages for the government's breach of the alleged implied-in-fact contracts. In addition, plaintiffs seek pre- and post-judgment interest, attorneys' fees, costs, and other expenses. Defendants filed a motion to dismiss on August 1, 2018 and an amended motion to dismiss on October 1, 2018.

Perry Capital LLC vs. the United States of America, Federal National Mortgage Association, and Federal Home Loan Mortgage Corporation. This case was filed as a derivative lawsuit, purportedly on behalf of Freddie Mac and Fannie Mae as "nominal" defendants, on August 15, 2018. The complaint alleges, among other items, that the net worth sweep dividend provisions of the senior preferred stock constitute an unlawful taking of private property for public use without just compensation or an illegal exaction in violation of the Fifth Amendment, and that by enacting the net worth sweep, the government breached the fiduciary duty it owed to Freddie Mac and Fannie Mae, and implied-in-fact contracts between the United States on the one hand and Freddie Mac and Fannie Mae on the other. The plaintiffs ask that plaintiffs, Freddie Mac, and Fannie Mae be awarded just compensation for the government's alleged taking of their property or damages for the illegal exaction; damages for the government's breach of fiduciary duties; and damages for the government's breach of the alleged implied-in-fact contracts. The proceedings have been stayed pending a ruling on defendants' motion to dismiss in the Fairholme Funds, Inc. litigation.

At present, it is not possible for us to predict the probable outcome of the lawsuits discussed above in the U.S. District Courts and the U.S. Court of Federal Claims (including the outcome of any appeal) or any potential effect on our business, financial condition, liquidity, or results of operations. In addition, we are unable to reasonably estimate the possible loss or range of possible loss in the event of an adverse judgment in the foregoing matters due to a number of factors, including the inherent uncertainty of pre-trial litigation. In addition, with respect to the In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase

Freddie Mac Form 10-Q 120

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 16

Agreement Class Action Litigations case, the plaintiffs have not demanded a stated amount of damages they believe are due, and the Court has not certified a class.

Freddie Mac Form 10-Q 121

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 17

NOTE 17

Regulatory Capital

In October 2008, FHFA announced that it was suspending capital classification of us during conservatorship in light of the Purchase Agreement. FHFA continues to monitor our capital levels, but the existing statutory and FHFA regulatory capital requirements are not binding during conservatorship.

We continue to provide quarterly submissions to FHFA on minimum capital. The table below summarizes our minimum capital requirements and deficits and net worth.

Table 17.1 - Net Worth and Minimum Capital

(In millions)	September 30, 2019			December 31, 2018
GAAP net worth (deficit)		$6,674			$4,477
Core capital (deficit)(1)(2)	(66,556		)	(68,036		)
Less: Minimum capital requirement(1)	18,817			17,553
Minimum capital surplus (deficit)(1)		($85,373	)		($85,589	)

(1) Core capital and minimum capital figures are estimates and represent amounts submitted to FHFA. FHFA is the authoritative source for our regulatory capital.

(2) Core capital excludes certain components of GAAP total equity (i.e., AOCI and the liquidation preference of the senior preferred stock) as these items do not meet the statutory definition of core capital.

In May 2017, FHFA, as Conservator, issued guidance to us to evaluate and manage our financial risk and to make economic business decisions, while in conservatorship, utilizing a newly-developed risk-based CCF, an economic capital system with detailed formulae provided by FHFA. We use the CCF to measure risk for making economically effective decisions. We are required to submit quarterly reports to FHFA related to the CCF requirements.

Freddie Mac Form 10-Q 122

Financial Statements Notes to the Condensed Consolidated Financial Statements | Note 18

NOTE 18

Selected Financial Statement Line Items

The table below presents the significant components of other income (loss) on our condensed consolidated statements of comprehensive income (loss).

Table 18.1 - Significant Components of Other Income (Loss)

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Other income (loss):
Income on guarantee obligation		$206			$176			$593			$524
All other	(60		)	(97		)	(204		)	124
Total other income (loss)		$146			$79			$389			$648

The table below presents the significant components of other assets and other liabilities on our condensed consolidated balance sheets.

Table 18.2 - Significant Components of Other Assets and Other Liabilities

(In millions)	September 30, 2019		December 31, 2018
Other assets:
Real estate owned, net		$607		$769
Accounts and other receivables(1)	12,816		2,447
Guarantee asset	4,225		3,633
Secured lending and other	5,439		1,805
All other	2,626		2,322
Total other assets		$25,713		$10,976
Other liabilities:
Guarantee obligation		$4,055		$3,561
All other	3,215		2,837
Total other liabilities		$7,270		$6,398

(1) Primarily consists of servicer receivables and other non-interest receivables.

END OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND ACCOMPANYING NOTES

Freddie Mac Form 10-Q 123

Other Information

Other Information

LEGAL PROCEEDINGS

We are involved as a party to a variety of legal proceedings. For more information, see Note 16 in this Form 10-Q and our 2018 Annual Report.

In addition, a number of lawsuits have been filed against the U.S. government related to the conservatorship and the Purchase Agreement. Some of these cases also have challenged the constitutionality of the structure of FHFA. For information on these lawsuits, see the Legal Proceedings section in our 2018 Annual Report. One such case, filed in the U.S. District Court for the Southern District of Texas, was appealed to the U.S. Court of Appeals for the Fifth Circuit. On September 6, 2019, the Fifth Circuit, en banc, held that the plaintiffs plausibly alleged that FHFA exceeded its conservator powers by transferring Freddie Mac's future value (i.e., profits via the net worth sweep) to a single shareholder, Treasury, and remanded that cause of action to the District Court. The Fifth Circuit also held that the "for cause" removal provision for the director of FHFA was unconstitutional, and that the provision should be struck from the statute. On September 25, 2019, the plaintiffs filed a petition for writ of certiorari to the U.S. Supreme Court seeking review of the Fifth Circuit’s decision. On October 25, 2019, the defendants also filed a petition for writ of certiorari seeking review of the Fifth Circuit's decision. Freddie Mac is not a party to any of these lawsuits.

RISK FACTORS

This Form 10-Q should be read together with the Risk Factors section in our 2018 Annual Report and in our Form 10-Q for the quarter ended June 30, 2019, which describe various risks and uncertainties to which we are or may become subject. These risks and uncertainties could, directly or indirectly, adversely affect our business, financial condition, results of operations, cash flows, strategies, and/or prospects.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Recent Sales of Unregistered Securities

The securities we issue are "exempted securities" under the Securities Act of 1933, as amended. As a result, we do not file registration statements with the SEC with respect to offerings of our securities.

Following our entry into conservatorship, we suspended the operation of, and ceased making grants under, equity compensation plans. Previously, we had provided equity compensation under those plans to employees and members of the Board of Directors. Under the Purchase Agreement, we cannot issue any new options, rights to purchase, participations, or other equity interests without Treasury's prior approval. However, grants outstanding as of the date of the Purchase Agreement remain in effect in accordance with their terms.

Information About Certain Securities Issuances by Freddie Mac

We make available, free of charge through our website at www.freddiemac.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all other SEC reports and amendments to those reports as soon as reasonably practicable after we electronically file the material with the SEC. The SEC also maintains an internet site (www.sec.gov) that contains reports, proxy and information statements, and other information regarding companies that file electronically with the SEC.

We provide disclosure about our debt securities on our website at www.freddiemac.com/debt. From this address, investors can access the offering circular and related supplements for debt securities offerings under Freddie Mac's global debt facility, including pricing supplements for individual issuances of debt securities. Similar information about our STACR transactions and SCR notes is available at crt.freddiemac.com and mf.freddiemac.com/investors, respectively.

We provide disclosure about our mortgage-related securities, some of which are off-balance sheet obligations (e.g., K Certificates and SB Certificates), on our website at www.freddiemac.com/mbs. From this address, investors can access information and documents, including offering circulars and offering circular supplements, for mortgage-related securities offerings.

We provide additional information, including product descriptions, investor presentations, securities issuance calendars, transactions volumes and details, redemption notices, Freddie Mac research, and material developments or other events that

Freddie Mac Form 10-Q 124

Other Information

may be important to investors, in each case as applicable, on the websites for our business segments, which can be found at www.freddiemac.com/singlefamily, mf.freddiemac.com, and www.freddiemac.com/capital-markets.

OTHER INFORMATION

Executive Management Compensation Program For 2020

As discussed in our Current Report on Form 8-K filed on August 27, 2019, FHFA, acting as Conservator, directed Freddie Mac to make specified changes to our executive compensation program for so long as we are in conservatorship, including increasing the mandatory deferral period for at-risk deferred salary for named executive officers, other than our Chief Executive Officer, from one year to two years and limiting base salaries for all employees, including named executive officers, to $600,000. Our Chief Executive Officer does not receive deferred salary, and therefore his compensation was not affected by this change. We have revised our executive management compensation program accordingly.

EXHIBITS

The exhibits are listed in the Exhibit Index of this Form 10-Q.

Freddie Mac Form 10-Q 125

Controls and Procedures

Controls and Procedures

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that the information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified by the SEC's rules and forms and that such information is accumulated and communicated to management of the company, including the company's Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing our disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and we must apply judgment in implementing possible controls and procedures.

Management, including the company's Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures as of September 30, 2019. As a result of management's evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of September 30, 2019, at a reasonable level of assurance, because we have not been able to update our disclosure controls and procedures to provide reasonable assurance that information known by FHFA on an ongoing basis is communicated from FHFA to Freddie Mac's management in a manner that allows for timely decisions regarding our required disclosure under the federal securities laws. We consider this situation to be a material weakness in our internal control over financial reporting.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING DURING 3Q 2019

We evaluated the changes in our internal control over financial reporting that occurred during 3Q 2019 and concluded that there were no changes that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

MITIGATING ACTIONS RELATED TO THE MATERIAL WEAKNESS IN INTERNAL CONTROL OVER FINANCIAL REPORTING

As described above under Evaluation of Disclosure Controls and Procedures, we have one material weakness in internal control over financial reporting as of September 30, 2019 that we have not remediated.

Given the structural nature of this material weakness, we believe it is likely that we will not remediate it while we are under conservatorship. However, both we and FHFA have continued to engage in activities and employ procedures and practices intended to permit accumulation and communication to management of information needed to meet our disclosure obligations under the federal securities laws. These include the following:

n FHFA has established the Division of Conservatorship, which is intended to facilitate operation of the company with the oversight of the Conservator.

n We provide drafts of our SEC filings to FHFA personnel for their review and comment prior to filing. We also provide drafts of external press releases, statements, and certain speeches to FHFA personnel for their review and comment prior to release.

n FHFA personnel, including senior officials, review our SEC filings prior to filing, including this Form 10-Q, and engage in discussions with us regarding issues associated with the information contained in those filings. Prior to filing this Form 10-Q, FHFA provided us with a written acknowledgment that it had reviewed the Form 10-Q, was not aware of any material misstatements or omissions in the Form 10-Q, and had no objection to our filing the Form 10-Q.

n The Director of FHFA is in frequent communication with our Chief Executive Officer, typically meeting (in person or by phone) on at least a bi-weekly basis.

n FHFA representatives attend meetings frequently with various groups within the company to enhance the flow of information and to provide oversight on a variety of matters, including accounting, credit and capital markets management, external communications, and legal matters.

Freddie Mac Form 10-Q 126

Controls and Procedures

n Senior officials within FHFA's accounting group meet frequently with our senior financial executives regarding our accounting policies, practices, and procedures.

In view of our mitigating actions related to this material weakness, we believe that our condensed consolidated financial statements for 3Q 2019 have been prepared in conformity with GAAP.

Freddie Mac Form 10-Q 127

Exhibit Index

Exhibit Index

Exhibit	Description*
4.1	Third Amended and Restated Certificate of Creation, Designation, Powers, Preferences, Rights, Privileges, Qualifications, Limitations, Restrictions, Terms and Conditions of Variable Liquidation Preference Senior Preferred Stock (par value $1.00 per share), dated September 30, 2019
10.1	Letter Agreement dated September 27, 2019 between the United States Department of the Treasury and the Federal Home Loan Mortgage Corporation,acting through the Federal Housing Finance Agency as its Conservator (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on October 1, 2019)
10.2	2020 Executive Management Compensation Program†
31.1	Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)
31.2	Certification of Executive Vice President —Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350
32.2	Certification of Executive Vice President —Chief Financial Officer pursuant to 18 U.S.C. Section 1350
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	XBRL Taxonomy Extension Schema
101. CAL	XBRL Taxonomy Extension Calculation
101.DEF	XBRL Taxonomy Extension Definition
101.LAB	XBRL Taxonomy Label
101. PRE	XBRL Taxonomy Extension Presentation
104	Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
* The SEC file numbers for the Registrant’s Registration Statement on Form 10, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K are 000-53330 and 001-34139.
† This exhibit is a management contract or compensatory plan, contract, or arrangement.

Freddie Mac Form 10-Q 128

Signatures

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Federal Home Loan Mortgage Corporation
By:	/s/ David M. Brickman
	David M. Brickman
	Chief Executive Officer

Date: October 30, 2019

By:	/s/ James G. Mackey
	James G. Mackey
	Executive Vice President — Chief Financial Officer
	(Principal Financial Officer)

Date: October 30, 2019

Freddie Mac Form 10-Q 129

Form 10-Q Index

Form 10-Q Index

Item Number		Page(s)
PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements	54 - 123
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	1 - 53
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37 - 41
Item 4.	Controls and Procedures	126 - 127
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	124
Item 1A	Risk Factors	124
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	124
Item 5.	Other Information	125
Item 6.	Exhibits	125
Exhibit Index		128
Signatures		129

Freddie Mac Form 10-Q 130

EX-4.1

EXHIBIT 4.1

EXECUTION VERSION

FREDDIE MAC

THIRD AMENDED AND RESTATED CERTIFICATE OF CREATION,

DESIGNATION, POWERS, PREFERENCES, RIGHTS,

PRIVILEGES, QUALIFICATIONS, LIMITATIONS,

RESTRICTIONS, TERMS AND CONDITIONS OF

VARIABLE LIQUIDATION PREFERENCE SENIOR PREFERRED STOCK

(PAR VALUE $1.00 PER SHARE)

The Federal Housing Finance Agency, as Conservator of the Federal Home Loan Mortgage Corporation, a government-sponsored enterprise of the United States of America (the “Company”), does hereby certify that, pursuant to authority vested in the Board of Directors of the Company by Section 306(f) of the Federal Home Loan Mortgage Corporation Act, and pursuant to the authority vested in the Conservator of the Company by Section 1367(b) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. §4617), as amended, the Conservator adopted Resolution FHLMC 2008-24 on September 7, 2008, which resolution is now, and at all times since such date has been, in full force and effect, and that the Conservator approved the final terms of the issuance and sale of the preferred stock of the Company designated above.

As amended and restated, effective September 30, 2019, in accordance with the Letter Agreement dated September 27, 2019, and the Third Amendment dated as of August 17, 2012, to the Amended and Restated Senior Preferred Stock Purchase Agreement dated as of September 26, 2008, the Senior Preferred Stock shall have the following designation, powers, preferences, rights, privileges, qualifications, limitations, restrictions, terms and conditions:

1.    Designation, Par Value, Number of Shares and Seniority

The class of preferred stock of the Company created hereby (the “Senior Preferred Stock”) shall be designated “Variable Liquidation Preference Senior Preferred Stock,” shall have a par value of $1.00 per share and shall consist of 1,000,000 shares. The Senior Preferred Stock shall rank prior to the common stock of the Company as provided in this Certificate and shall rank, as to both dividends and distributions upon liquidation, prior to (a) the Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock issued on December 4, 2007, (b) the 6.55% Non-Cumulative Preferred Stock issued on September 28, 2007, (c) the 6.02% Non-Cumulative Preferred Stock issued on July 24, 2007, (d) the 5.66% Non-Cumulative Preferred Stock issued on April 16, 2007, (e) the 5.57% Non-Cumulative Preferred Stock issued on January 16, 2007, (f) the 5.9% Non-Cumulative Preferred Stock issued on October 16, 2006, (g) the 6.42% Non-Cumulative Preferred Stock issued on July 17, 2006, (h) the Variable Rate, Non-Cumulative Preferred Stock issued on July 17, 2006, (i) the 5.81% Non-Cumulative Preferred Stock issued on January 29, 2002, (j) the 5.7% Non-Cumulative Preferred Stock issued on October 30, 2001, (k) the 6% Non-Cumulative Preferred Stock issued on May 30, 2001, (l) the Variable Rate, Non-Cumulative Preferred Stock issued on May 30, 2001 and June 1, 2001, (m) the 5.81% Non-Cumulative Preferred Stock issued on March 23, 2001, (n) the Variable Rate, Non-Cumulative Preferred Stock issued on March 23, 2001, (o) the Variable Rate, Non-Cumulative Preferred Stock issued on January 26, 2001, (p) the Variable Rate, Non-Cumulative Preferred Stock issued on November 5, 1999, (q) the 5.79% Non-Cumulative Preferred Stock issued on July 21, 1999, (r) the 5.1% Non-Cumulative Preferred Stock issued on March 19, 1999, (s) the 5.3% Non-Cumulative Preferred Stock issued on October 28, 1998, (t) the 5.1%  Non-Cumulative Preferred Stock issued on September 23, 1998, (u) the Variable Rate, Non-Cumulative Preferred Stock issued on September 23, 1998 and September 29, 1998, (v) the 5% Non-Cumulative Preferred Stock issued on March 23, 1998, (w) the 5.81% Non-Cumulative Preferred Stock issued on October 27, 1997, (x) the Variable Rate, Non-Cumulative Preferred Stock issued on April 26, 1996, (y) any other capital stock of the Company outstanding on the date of the initial issuance of the Senior Preferred Stock, and (z) any capital stock of the Company that may be issued after the date of initial issuance of the Senior Preferred Stock.

2.    Dividends

(a)  For each Dividend Period from the date of the initial issuance of the Senior Preferred Stock through and including December 31, 2012, holders of outstanding shares of Senior Preferred Stock shall be entitled to receive, ratably, when, as and if declared by the Board of Directors, in its sole discretion, out of funds legally available therefor, cumulative cash dividends at the annual rate per share equal to the then-current Dividend Rate on the then-current Liquidation Preference. For each Dividend Period from January 1, 2013, holders of outstanding shares of Senior Preferred Stock shall be entitled to receive, ratably, when, as and if declared by the Board of Directors, in its sole discretion, out of funds legally available therefor, cumulative cash dividends in an amount equal to the then-current Dividend Amount. Dividends on the Senior Preferred Stock shall accrue from but not including the date of the initial issuance of the Senior Preferred Stock and will be payable in arrears when, as and if declared by the Board of Directors quarterly on March 31, June 30, September 30 and December 31 of each year (each, a “Dividend Payment Date”), commencing on December 31, 2008. If a Dividend Payment Date is not a “Business Day,” the related dividend will be paid not later than the next Business Day with the same force and effect as though paid on the Dividend Payment Date, without any increase to account for the period from such Dividend Payment Date through the date of actual payment. “Business Day” means a day other than (i) a Saturday or Sunday, (ii) a day on which New York City banks are closed, or (iii) a day on which the offices of the Company are closed.

If declared, the initial dividend will be for the period from but not including the date of the initial issuance of the Senior Preferred Stock through and including December 31, 2008. Except for the initial Dividend Payment Date, the “Dividend Period” relating to a Dividend Payment Date will be the period from but not including the preceding Dividend Payment Date through and including the related Dividend Payment Date. For each Dividend Period from the date of the initial issuance of the Senior Preferred Stock through and including December 31, 2012, the amount of dividends payable on the initial Dividend Payment Date or for any Dividend Period through and including December 31, 2012, that is not a full calendar quarter shall be computed on the basis of 30-day months, a 360-day year and the actual number of days elapsed in any period of less than one month. For the avoidance of doubt, for each Dividend Period from the date of the initial issuance of the Senior Preferred Stock through and including December 31, 2012, in the event that the Liquidation Preference changes in the middle of a Dividend Period, the amount of dividends payable on the Dividend Payment Date at the end of such Dividend Period shall take into account such change in Liquidation Preference and shall be computed at the Dividend Rate on each Liquidation Preference based on the portion of the Dividend Period that each Liquidation Preference was in effect.

(b)  To the extent not paid pursuant to Section 2(a) above, dividends on the Senior Preferred Stock shall accrue and shall be added to the Liquidation Preference pursuant to Section 8, whether or not there are funds legally available for the payment of such dividends and whether or not dividends are declared.

(c)  For each Dividend Period from the date of the initial issuance of the Senior Preferred Stock through and including December 31, 2012, “Dividend Rate” means 10.0 percent; provided, however, that if at any time the Company shall have for any reason failed to pay dividends in cash in a timely manner as required by this Certificate, then immediately following such failure and for all Dividend Periods thereafter until the Dividend Period following the date on which the Company shall have paid in cash full cumulative dividends (including any unpaid dividends added to the Liquidation Preference pursuant to Section 8), the “Dividend Rate” shall mean 12.0 percent.

For each Dividend Period from January 1, 2013, and thereafter, the “Dividend Amount” for a Dividend Period means the amount, if any, by which the Net Worth Amount at the end of the immediately preceding fiscal quarter, less the Applicable Capital Reserve Amount for such Dividend Period, exceeds zero. In each case, “Net Worth Amount” means (i) the total assets of the Company (such assets excluding the Commitment and any unfunded amounts thereof) as reflected on the balance sheet of the Company as of the applicable date set forth in this Certificate, prepared in accordance with GAAP, less (ii) the total liabilities of the Company (such liabilities excluding any obligation in respect of any capital stock of the Company, including this Certificate), as reflected on the balance sheet of the Company as of the applicable date set forth in this Certificate, prepared in accordance with GAAP. “Applicable Capital Reserve Amount” means, as of any date of determination, (A) for each Dividend Period from January 1, 2013, through and including December 31, 2013, $3,000,000,000; (B) for each Dividend Period occurring within each 12-month period thereafter, through and including December 31, 2017, $3,000,000,000 reduced by $600,000,000 for each such 12-month period, so that for each Dividend Period from January 1, 2017, through and including December 31, 2017, the Applicable Capital Reserve Amount shall be $600,000,000; (C) for each Dividend Period from January 1, 2018, through and including June 30, 2019, $3,000,000,000; and (D) for each Dividend Period from July 1, 2019, and thereafter, $20,000,000,000. Notwithstanding the foregoing, for each Dividend Period from January 1, 2018, and thereafter, following any Dividend Payment Date with respect to which the Board of Directors does not declare and pay a dividend or declares and pays a dividend in an amount less than the Dividend Amount, the Applicable Capital Reserve Amount shall thereafter be zero. For the avoidance of doubt, if the calculation of the Dividend Amount for a Dividend Period does not exceed zero, then no Dividend Amount shall accrue or be payable for such Dividend Period.

(d)  Each such dividend shall be paid to the holders of record of outstanding shares of the Senior Preferred Stock as they appear in the books and records of the Company on such record date as shall be fixed in advance by the Board of Directors, not to be earlier than 45 days nor later than 10 days preceding the applicable Dividend Payment Date. The Company may not, at any time, declare or pay dividends on, make distributions with respect to, or redeem, purchase or acquire, or make a liquidation payment with respect to, any common stock or other securities ranking junior to the Senior Preferred Stock unless (i) full cumulative dividends on the outstanding Senior Preferred Stock in respect of the then-current Dividend Period and all past Dividend Periods (including any unpaid dividends added to the Liquidation Preference pursuant to Section 8) have been declared and paid in cash (including through any pay down of Liquidation Preference pursuant to Section 3) and (ii) all amounts required to be paid pursuant to Section 4 (without giving effect to any prohibition on such payment under any applicable law) have been paid in cash.

(e)  Notwithstanding any other provision of this Certificate, the Board of Directors, in its discretion, may choose to pay dividends on the Senior Preferred Stock without the payment of any dividends on the common stock, preferred stock or any other class or series of stock from time to time outstanding ranking junior to the Senior Preferred Stock with respect to the payment of dividends.

(f)  If and whenever dividends, having been declared, shall not have been paid in full, as aforesaid, on shares of the Senior Preferred Stock, all such dividends that have been declared on shares of the Senior Preferred Stock shall be paid to the holders pro rata based on the aggregate Liquidation Preference of the shares of Senior Preferred Stock held by each holder, and any amounts due but not paid in cash shall be added to the Liquidation Preference pursuant to Section 8.

3.    Optional Pay Down of Liquidation Preference

(a)  Following termination of the Commitment (as defined in the Preferred Stock Purchase Agreement referred to in Section 8 below), and subject to any limitations which may be imposed by law and the provisions below, the Company may pay down the Liquidation Preference of all outstanding shares of the Senior Preferred Stock pro rata, at any time, in whole or in part, out of funds legally available therefor, with such payment first being used to reduce any accrued and unpaid dividends previously added to the Liquidation Preference pursuant to Section 8 below and, to the extent all such accrued and unpaid dividends have been paid, next being used to reduce any Periodic Commitment Fees (as defined in the Preferred Stock Purchase Agreement referred to in Section 8 below) previously added to the Liquidation Preference pursuant to Section 8 below. Prior to termination of the Commitment, and subject to any limitations which may be imposed by law and the provisions below, the Company may pay down the Liquidation Preference of all outstanding shares of the Senior Preferred Stock pro rata, at any time, out of funds legally available therefor, but only to the extent of (i) accrued and unpaid dividends previously added to the Liquidation Preference pursuant to Section 8 below and not repaid by any prior pay down of Liquidation Preference and (ii) Periodic Commitment Fees previously added to the Liquidation Preference pursuant to Section 8 below and not repaid by any prior pay down of Liquidation Preference. Any pay down of Liquidation Preference permitted by this Section 3 shall be paid by making a payment in cash to the holders of record of outstanding shares of the Senior Preferred Stock as they appear in the books and records of the Company on such record date as shall be fixed in advance by the Board of Directors, not to be earlier than 45 days nor later than 10 days preceding the date fixed for the payment.

(b)  In the event the Company shall pay down of the Liquidation Preference of the Senior Preferred Stock as aforesaid, notice of such pay down shall be given by the Company by first class mail, postage prepaid, mailed neither less than 10 nor more than 45 days preceding the date fixed for the payment, to each holder of record of the shares of the Senior Preferred Stock, at such holder’s address as the same appears in the books and records of the Company. Each such notice shall state the amount by which the Liquidation Preference of each share shall be reduced and the pay down date.  

(c)  If after termination of the Commitment the Company pays down the Liquidation Preference of each outstanding share of Senior Preferred Stock in full, such shares shall be deemed to have been redeemed as of the date of such payment, and the dividend that would otherwise be payable for the Dividend Period ending on the pay down date will be paid on such date. Following such deemed redemption, the shares of the Senior Preferred Stock shall no longer be deemed to be outstanding, and all rights of the holders thereof as holders of the Senior Preferred Stock shall cease, with respect to shares so redeemed, other than the right to receive the pay down amount (which shall include the final dividend for such shares). Any shares of the Senior Preferred Stock which shall have been so redeemed, after such redemption, shall no longer have the status of authorized, issued or outstanding shares.

4.    Mandatory Pay Down of Liquidation Preference Upon Issuance of Capital Stock

(a)  If the Company shall issue any shares of capital stock (including without limitation common stock or any series of preferred stock) in exchange for cash at any time while the Senior Preferred Stock is outstanding, then the Company shall, within 10 Business Days, use the proceeds of such issuance net of the direct costs relating to the issuance of such securities (including, without limitation, legal, accounting and investment banking fees) to pay down the Liquidation Preference of all outstanding shares of Senior Preferred Stock pro rata, out of funds legally available therefor, by making a payment in cash to the holders of record of outstanding shares of the Senior Preferred Stock as they appear in the books and records of the Company on such record date as shall be fixed in advance by the Board of Directors, not to be earlier than 45 days nor later than 10 days preceding the date fixed for the payment, with such payment first being used to reduce any accrued and unpaid dividends previously added to the Liquidation Preference pursuant to Section 8 below and, to the extent all such accrued and unpaid dividends have been paid, next being used to reduce any Periodic Commitment Fees (as defined in the Preferred Stock Purchase Agreement referred to in Section 8 below) previously added to the Liquidation Preference pursuant to Section 8 below; provided that, prior to the termination of the Commitment (as defined in the Preferred Stock Purchase Agreement referred to in Section 8 below), the Liquidation Preference of each share of Senior Preferred Stock shall not be paid down below $1,000 per share.

(b) If the Company shall not have sufficient assets legally available for the pay down of the Liquidation Preference of the shares of Senior Preferred Stock required under Section 4(a), the Company shall pay down the Liquidation Preference per share to the extent permitted by law, and shall pay down any Liquidation Preference not so paid down because of the unavailability of legally available assets or other prohibition as soon as practicable to the extent it is thereafter able to make such pay down legally. The inability of the Company to make such payment for any reason shall not relieve the Company from its obligation to effect any required pay down of the Liquidation Preference when, as and if permitted by law.

(c)  If after the termination of the Commitment the Company pays down the Liquidation Preference of each outstanding share of Senior Preferred Stock in full, such shares shall be deemed to have been redeemed as of the date of such payment, and the dividend that would otherwise be payable for the Dividend Period ending on the pay down date will be paid on such date. Following such deemed redemption, the shares of the Senior Preferred Stock shall no longer be deemed to be outstanding, and all rights of the holders thereof as holders of the Senior Preferred Stock shall cease, with respect to shares so redeemed, other than the right to receive the pay down amount (which shall include the final dividend for such redeemed shares). Any shares of the Senior Preferred Stock which shall have been so redeemed, after such redemption, shall no longer have the status of authorized, issued or outstanding shares.

5.    No Voting Rights

Except as set forth in this Certificate or otherwise required by law, the shares of the Senior Preferred Stock shall not have any voting powers, either general or special.

6.    No Conversion or Exchange Rights

The holders of shares of the Senior Preferred Stock shall not have any right to convert such shares into or exchange such shares for any other class or series of stock or obligations of the Company.

7.    No Preemptive Rights

No holder of the Senior Preferred Stock shall as such holder have any preemptive right to purchase or subscribe for any other shares, rights, options or other securities of any class of the Company which at any time may be sold or offered for sale by the Company.

8.    Liquidation Rights and Preference

(a)  Except as otherwise set forth herein, upon the voluntary or involuntary dissolution, liquidation or winding up of the Company, the holders of the outstanding shares of the Senior Preferred Stock shall be entitled to receive out of the assets of the Company available for distribution to stockholders, before any payment or distribution shall be made on the common stock or any other class or series of stock of the Company ranking junior to the Senior Preferred Stock upon liquidation, the amount per share equal to the Liquidation Preference plus an amount, determined in accordance with Section 2(a) above, equal to the dividend otherwise payable for the then-current Dividend Period accrued through and including the date of payment in respect of such dissolution, liquidation or winding up; provided, however, that if the assets of the Company available for distribution to stockholders shall be insufficient for the payment of the amount which the holders of the outstanding shares of the Senior Preferred Stock shall be entitled to receive upon such dissolution, liquidation or winding up of the Company as aforesaid, then, all of the assets of the Company available for distribution to stockholders shall be distributed to the holders of outstanding shares of the Senior Preferred Stock pro rata based on the aggregate Liquidation Preference of the shares of Senior Preferred Stock held by each holder.

(b)  “Liquidation Preference” shall initially mean $1,000 per share and shall be:

(i)  increased each time a Deficiency Amount (as defined in the Preferred Stock Purchase Agreement) is paid to the Company by an amount per share equal to the aggregate amount so paid to the Company divided by the number of shares of Senior Preferred Stock outstanding at the time of such payment;

(ii)  increased each time the Company does not pay the full Periodic Commitment Fee (as defined in the Preferred Stock Purchase Agreement) in cash by an amount per share equal to the amount of the Periodic Commitment Fee that is not paid in cash divided by the number of shares of Senior Preferred Stock outstanding at the time such payment is due;

(iii)  increased on the Dividend Payment Date if the Company fails to pay in full the dividend payable for the Dividend Period ending on such date by an amount per share equal to the aggregate amount of unpaid dividends divided by the number of shares of Senior Preferred Stock outstanding on such date; and

(iv)  decreased each time the Company pays down the Liquidation Preference pursuant to Section 3 or Section 4 of this Certificate by an amount per share equal to the aggregate amount of the pay down divided by the number of shares of Senior Preferred Stock outstanding at the time of such pay down.

(c)  “Preferred Stock Purchase Agreement” means the Preferred Stock Purchase Agreement, dated September 7, 2008, between the Company and the United States Department of the Treasury.

(d)  Neither the sale of all or substantially all of the property or business of the Company, nor the merger, consolidation or combination of the Company into or with any other corporation or entity, shall be deemed to be a dissolution, liquidation or winding up for the purpose of this Section 8.

9.    Additional Classes or Series of Stock

The Board of Directors shall have the right at any time in the future to authorize, create and issue, by resolution or resolutions, one or more additional classes or series of stock of the Company, and to determine and fix the distinguishing characteristics and the relative rights, preferences, privileges and other terms of the shares thereof; provided that, any such class or series of stock may not rank prior to or on parity with the Senior Preferred Stock without the prior written consent of the holders of at least two-thirds of all the shares of Senior Preferred Stock at the time outstanding.

10.    Miscellaneous

(a)  The Company and any agent of the Company may deem and treat the holder of a share or shares of Senior Preferred Stock, as shown in the Company’s books and records, as the absolute owner of such share or shares of Senior Preferred Stock for the purpose of receiving payment of dividends in respect of such share or shares of Senior Preferred Stock and for all other purposes whatsoever, and neither the Company nor any agent of the Company shall be affected by any notice to the contrary. All payments made to or upon the order of any such person shall be valid and, to the extent of the sum or sums so paid,

effectual to satisfy and discharge liabilities for moneys payable by the Company on or with respect to any such share or shares of Senior Preferred Stock.

  (b)  The shares of the Senior Preferred Stock, when duly issued, shall be fully paid and non-assessable.

(c)  The Senior Preferred Stock may be issued, and shall be transferable on the books of the Company, only in whole shares.

(d)  For purposes of this Certificate, the term “the Company” means the Federal Home Loan Mortgage Corporation and any successor thereto by operation of law or by reason of a merger, consolidation, combination or similar transaction.

(e)  This Certificate and the respective rights and obligations of the Company and the holders of the Senior Preferred Stock with respect to such Senior Preferred Stock shall be construed in accordance with and governed by the laws of the United States, provided that the law of the Commonwealth of Virginia shall serve as the federal rule of decision in all instances except where such law is inconsistent with the Company’s enabling legislation, its public purposes or any provision of this Certificate.

(f)  Any notice, demand or other communication which by any provision of this Certificate is required or permitted to be given or served to or upon the Company shall be given or served in writing addressed (unless and until another address shall be published by the Company) to Freddie Mac, 8200 Jones Branch Drive, McLean, Virginia 22102, Attn: Executive Vice President and General Counsel. Such notice, demand or other communication to or upon the Company shall be deemed to have been sufficiently given or made only upon actual receipt of a writing by the Company. Any notice, demand or other communication which by any provision of this Certificate is required or permitted to be given or served by the Company hereunder may be given or served by being deposited first class, postage prepaid, in the United States mail addressed (i) to the holder as such holder’s name and address may appear at such time in the books and records of the Company or (ii) if to a person or entity other than a holder of record of the Senior Preferred Stock, to such person or entity at such address as reasonably appears to the Company to be appropriate at such time. Such notice, demand or other communication shall be deemed to have been sufficiently given or made, for all purposes, upon mailing.

(g)  The Company, by or under the authority of the Board of Directors, may amend, alter, supplement or repeal any provision of this Certificate pursuant to the following terms and conditions:

(i)  Without the consent of the holders of the Senior Preferred Stock, the Company may amend, alter, supplement or repeal any provision of this Certificate to cure any ambiguity, to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Certificate, provided that such action shall not adversely affect the interests of the holders of the Senior Preferred Stock.

(ii)  The consent of the holders of at least two-thirds of all of the shares of the Senior Preferred Stock at the time outstanding, given in person or by proxy, either in writing or by a vote at a meeting called for the purpose at which the holders of shares of the Senior Preferred Stock shall vote together as a class, shall be necessary for authorizing, effecting or validating the amendment, alteration, supplementation or repeal (whether by merger, consolidation or otherwise) of the provisions of this Certificate other than as set forth in subparagraph (i) of this paragraph (g). The creation and issuance of any other class or series of stock, or the issuance of additional shares of any existing class or series of stock, of the Company ranking junior to the Senior Preferred Stock shall not be deemed to constitute such an amendment, alteration, supplementation or repeal.

(iii)  Holders of the Senior Preferred Stock shall be entitled to one vote per share on matters on which their consent is required pursuant to subparagraph (ii) of this paragraph (g). In connection with any meeting of such holders, the Board of Directors shall fix a record date, neither earlier than 60 days nor later than 10 days prior to the date of such meeting, and holders of record of shares of the Senior Preferred Stock on such record date shall be entitled to notice of and to vote at any such meeting and any adjournment. The Board of Directors, or such person or persons as it may designate, may establish reasonable rules and procedures as to the solicitation of the consent of holders of the Senior Preferred Stock at any such meeting or otherwise, which rules and procedures shall conform to the requirements of any national securities exchange on which the Senior Preferred Stock may be listed at such time.

(h)  RECEIPT AND ACCEPTANCE OF A SHARE OR SHARES OF THE SENIOR PREFERRED STOCK BY OR ON BEHALF OF A HOLDER SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER (AND ALL OTHERS HAVING BENEFICIAL OWNERSHIP OF SUCH SHARE OR SHARES) OF ALL OF THE TERMS AND PROVISIONS OF THIS CERTIFICATE. NO SIGNATURE OR OTHER FURTHER MANIFESTATION OF ASSENT TO THE TERMS AND PROVISIONS OF THIS CERTIFICATE SHALL BE NECESSARY FOR ITS OPERATION OR EFFECT AS BETWEEN THE COMPANY AND THE HOLDER (AND ALL SUCH OTHERS).

IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the Company this 30th day of September, 2019.

[Seal]

FEDERAL HOME LOAN MORTGAGE CORPORATION,
by
The Federal Housing Finance Agency, its Conservator
By:	/s/ Mark A. Calabria
	Mark A. Calabria
	Director

EX-10.2

Exhibit 10.2

2020 EXECUTIVE MANAGEMENT COMPENSATION PROGRAM (“2020 EMCP”)

Program Document

Effective January 1, 2020

Covered Positions	A “Covered Officer” is any Freddie Mac1 officer at the Senior Vice President (“SVP”) level and above other than the Chief Executive Officer (“CEO”).
Covered Position Participation Requirement	Participation in the 2020 EMCP is conditioned on the Covered Officer’s agreement to the terms and conditions set forth herein and in the EMCP Recapture and Forfeiture Agreement (“Recapture Agreement”). A Covered Officer who does not agree to the terms of both the 2020 EMCP and the Recapture Agreement will receive only Base Salary.  The terms and conditions set forth in the Recapture Agreement are incorporated in and made a part of this 2020 EMCP.
Target Total Direct Compensation2	A Covered Officer’s target total direct compensation (“Target TDC”) is the sum of Base Salary and Deferred Salary, each of which is paid in cash.
Base Salary	Base Salary is earned and paid on the company’s standard payroll cycle and cannot exceed $600,000 without Federal Housing Finance Agency (“FHFA”) approval.
Deferred Salary	The portion of Target TDC not paid in Base Salary is Deferred Salary, which is earned on the company’s standard payroll cycle. The amount earned in each quarter, plus interest earned on that amount as described below under “Interest on Deferred Salary,” will be paid in cash according to the “Approved Payment Schedule”. Deferred Salary consists of the following two elements: At-Risk Deferred Salary - At-Risk Deferred Salary shall be equal to 30% of the Covered Officer’s Target TDC. The amount of At-Risk Deferred Salary earned in a calendar year is subject to reduction based on corporate and individual performance as follows: • One-half of At-Risk Deferred Salary (or 15% of Target TDC) is subject to reduction based on an assessment by FHFA of performance against Conservatorship Scorecard objectives relevant for the calendar year in which the At-Risk Deferred Salary is earned.3 The reduction can range from 0% (no reduction) to 100% (the maximum reduction). • One-half of At-Risk Deferred Salary (or 15% of Target TDC) is subject to reduction based on the Covered Officer’s performance against individual objectives and an assessment of the company’s performance against Corporate Scorecard objectives, each relevant to the calendar year in which the At-Risk Deferred Salary is earned. The total reduction can range from 0% (no reduction) to 100% (the maximum reduction). A Covered Officer’s performance during the calendar year will be assessed by the CEO, in his/her sole discretion, pursuant to the performance assessment and reduction process in effect for such year.

________________________

¹ For purposes of this Program Document, Freddie Mac refers to the Federal Home Loan Mortgage Corporation and any of its wholly-owned subsidiaries.

² Initially expressed as an annual rate. Amount will be prorated, as appropriate, to reflect date of hire, promotion into a Covered Position, date of termination, or other adjustment to Target TDC.

³ For the Covered Officer leading the Internal Audit function, the reduction will be based on the appropriate Board committee's and FHFA's assessment of performance against the Internal Audit Scorecard objectives.

Deferred Salary (continued)	At-Risk Deferred Salary payments for Covered Officers are subject to review and approval by the Committee and FHFA, as appropriate. Fixed Deferred Salary - Fixed Deferred Salary shall be equal to the Covered Officer’s Target TDC less Base Salary and less At-Risk Deferred Salary and is not subject to reduction based on either corporate or individual performance. Payment of both At-Risk and Fixed Deferred Salary is also subject, if applicable, to the “Treatment Upon Termination” provisions set forth below.
Deferred Salary Approved Payment Schedule	At-Risk Deferred Salary - For Covered Officers hired after December 31, 2019, At-Risk Deferred Salary earned in each quarter will be paid on the last regular pay date in the corresponding quarter of the second calendar year following the quarter in which it was earned. For Covered Officers hired prior to December 31, 2019, At-Risk Deferred Salary earned in each quarter prior to January 1, 2022, will be paid on the last regular pay date in the corresponding quarter of the following calendar year. At-Risk Deferred Salary earned in each quarter after January 1, 2022, will be paid on the last regular pay date in the corresponding quarter of the second calendar year following the quarter in which it was earned. Fixed Deferred Salary - Fixed Deferred Salary earned in each quarter will be paid on the last regular pay date within the corresponding quarter of the following calendar year.
Interest on Deferred Salary	Interest will be credited on the amount of a Covered Officer’s At-Risk and Fixed Deferred Salary earned during each calendar quarter. The interest rate used is one-half the one-year Treasury Bill rate in effect on the last business day immediately preceding the year in which Deferred Salary is earned. The amount on which interest is accrued will take into account any reduction for corporate and/or individual performance applicable to a Covered Officer’s At-Risk Deferred Salary and any reduction applicable to a Covered Officer’s Fixed Deferred Salary resulting from certain terminations of employment as described in “Treatment Upon Termination: Fixed Deferred Salary.” Interest is earned from the first day of the calendar quarter following the quarter during which the Deferred Salary is earned through the payment date under the Approved Payment Schedule or, in the event of death, the actual payment date. The amount of interest payable with respect to a Covered Officer’s Deferred Salary will be determined as of the payment date and will be paid at the same time as the Deferred Salary to which it relates. If Deferred Salary is forfeited or recaptured for any of the reasons described in the Recapture Agreement, the related interest will also be forfeited or recaptured.
Impact on Retirement, Executive, and Welfare Plans	The treatment of Base Salary and Deferred Salary as compensation for purposes of Freddie Mac’s retirement and welfare benefit plans is governed by the actual terms of those plans. The table below summarizes whether the Base Salary and Deferred Salary a Covered Officer receives while an activeemployee are treated as compensation for purposes of the following Freddie Mac retirement and welfare benefit plans. Freddie Mac retains the right to amend, revise or discontinue any of the retirement and welfare benefit plans and the terms of each plan will prevail in the event that there is any conflict between those terms and the table below.

Impact on Retirement, Executive, and Welfare Plans (continued)	Freddie Mac's Retirement and Welfare Benefit Plans	Base Salary Considered Compensation?	Deferred Salary Considered Compensation?
	Tax-Qualified Thrift/401(k)	Yes	Yes
	Non-Qualified Thrift/401(k) Supplemental Executive Retirement Plan (SERP)4	Yes	Yes
	Group Term Life Insurance	Yes	No
	Group Universal Life Insurance	Yes	No
	Long-Term Disability Plan	Yes	No
	Accidental Death and Personal Loss Insurance	Yes	No
	Business Travel Accident Insurance	Yes	No
	Worker’s Compensation	Yes	No
	Purchase/Payout of Vacation	Yes	No
	Interest earned on Deferred Salary, as well as any Base Salary or Deferred Salary a Covered Officer receives after termination of employment are not treated as compensation for purposes of any Freddie Mac retirement or welfare benefit plan.
Treatment Upon Termination: Base Salary	Base Salary will cease upon termination of employment, regardless of the reason for such termination.

____________________________

⁴ Compensation for purposes of the Non-Qualified Thrift/401(k) SERP may not exceed two times a Covered Officer’s Base Salary.

Treatment Upon Termination: At-Risk Deferred Salary

The timing and payment of any unpaid portion of At-Risk Deferred Salary is based on the reason for termination of employment, as follows: • Forfeiture Event - All earned but unpaid At-Risk Deferred Salary and related interest is subject to forfeiture if a Covered Officer is terminated due to the occurrence of an event or conduct described in the Recapture Agreement; • Death - All earned but unpaid At-Risk Deferred Salary and related interest is paid as soon as administratively possible, but not later than 90 calendar days after the date of death, subject to the terms and conditions of the Recapture Agreement; and • Any Other Reason5 - All earned but unpaid At-Risk Deferred Salary and related interest is paid in accordance with the Approved Payment Schedule, subject to the terms and conditions of the Recapture Agreement. Payment of earned but unpaid At-Risk Deferred Salary and related interest following a termination of employment shall be subject to the performance assessment and reduction process. The performance assessment and reduction process for At-Risk Deferred Salary is waived, however, in cases of death or Long-Term Disability (as defined in the Long-Term Disability Plan in effect on the date of termination) if the process is not complete as of the termination date.

Treatment Upon Termination: Fixed Deferred Salary

The timing and payment of any unpaid portion of Fixed Deferred Salary is based on the reason for termination of employment, as follows: • Forfeiture Event- All earned but unpaid Fixed Deferred Salary and related interest is subject to forfeiture if a Covered Officer is terminated due to the occurrence of an event or conduct described in the Recapture Agreement; • Death - All earned but unpaid Fixed Deferred Salary and related interest is paid in full as soon as administratively possible, but not later than 90 calendar days after the date of death, subject to the terms and conditions of the Recapture Agreement; and • Any Other Reason5 - All earned but unpaid Fixed Deferred Salary and related interest is paid in accordance with the Approved Payment Schedule, subject to the terms and conditions of the Recapture Agreement. A Covered Officer’s earned but unpaid Fixed Deferred Salary will be reduced by 2% for each full or partial month by which the termination precedes January 31 of the second calendar year following the calendar year in which the Fixed Deferred Salary is earned. This reduction will not be applied in cases of death, Long-Term Disability, a severance-eligible termination, as defined in the severance plan applicable to Covered Officers who are not executive officers, or retirement. A Covered Officer is considered to have retired when s/he voluntarily terminates employment after attaining or exceeding 62 years of age, regardless of length of service, or attaining or exceeding 55 years of age with 10 or more years of continuous service.

_______________________

⁵ Any Other Reason includes, but is not limited to, voluntary terminations, retirement, Long-Term Disability, and involuntary termination for any reason other than a Forfeiture Event.

Reservation of Rights and Applicable Law Each Covered Officer’s employment with Freddie Mac is “at-will,” meaning that either the Covered Officer or Freddie Mac may terminate such employment at any time with or without cause or notice. Nothing in this Program Document or any other document referred to or incorporated by reference herein shall be held or construed to change the at-will nature of any Covered Officer’s employment with Freddie Mac. Nothing in this Program Document is intended or shall be construed to abrogate FHFA’s authority to either: (i) modify or terminate any compensation plan or program (including the 2020 EMCP); or (ii) disapprove the actual payment of any form of compensation to be paid pursuant to the 2020 EMCP. FHFA retains the right to modify any of the terms and conditions of your employment, including the right to modify or rescind the terms and conditions of the 2020 EMCP as well as the actual payment of compensation to you pursuant thereto, without giving rise to liability on the part of Freddie Mac. The 2020 EMCP is subject to and shall be construed in accordance with: (i) any applicable law and any applicable regulation, guidance or interpretation of FHFA and/or the United States Department of the Treasury; and (ii) the substantive laws of the Commonwealth of Virginia, excluding provisions of the Virginia law concerning choice-of-law that would result in the law of any state other than Virginia being applied. Payment of Deferred Salary under the 2020 EMCP is intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986 (“Section 409A”), as amended, and, specifically, with the separation pay exemption and short-term deferral exemption of Section 409A, and shall in all respects be construed, interpreted, and administered in accordance with Section 409A. Notwithstanding anything in the 2020 EMCP to the contrary, payments may only be made pursuant to the 2020 EMCP upon an event and in a manner permitted by Section 409A or an applicable exemption. All payments to be made upon a termination of employment under this Program Document may only be made upon a “separation from service” under section 409A. If a Covered Officer is a “specified employee” (within the meaning of Section 409A(a)(2)(B)(i)) at the time of a separation from service, payments scheduled to be made during the six months following the separation from service shall, to the extent required by Section 409A, be deferred to and payable on the first day of the seventh month following the separation from service.

This 2020 EMCP will be in effect for 2020 and subsequent years unless and until amended or superseded. By signing below, I acknowledge that I understand and voluntarily agree to the terms of this 2020 EMCP:

___________________________________________         _____________________

Covered Officer’s Signature                 Date

___________________________________________

Printed Name

___________________________________________

Title

EX-31.1

Exhibit 31.1

CERTIFICATION

PURSUANT TO SECURITIES EXCHANGE ACT RULE 13a-14(a)

I, David M. Brickman, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 of the Federal Home Loan Mortgage Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 30, 2019

/s/ David M. Brickman

David M. Brickman

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

PURSUANT TO SECURITIES EXCHANGE ACT RULE 13a-14(a)

I, James G. Mackey, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 of the Federal Home Loan Mortgage Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 30, 2019

/s/ James G. Mackey

James G. Mackey

Executive Vice President — Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ENACTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 of the Federal Home Loan Mortgage Corporation (the "Company"), as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, David M. Brickman, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: October 30, 2019

/s/ David M. Brickman

David M. Brickman

Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ENACTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 of the Federal Home Loan Mortgage Corporation (the "Company"), as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, James G. Mackey, Executive Vice President – Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: October 30, 2019

/s/ James G. Mackey

James G. Mackey

Executive Vice President — Chief Financial Officer

XML

Collateral and Offsetting of Assets and Liabilities

9 Months Ended

Sep. 30, 2019

Offsetting [Abstract]

COLLATERAL AND OFFSETTING OF ASSETS AND LIABILITIES

Collateralized Agreements and Offsetting Arrangements

Derivative Portfolio

Derivative Counterparties

Our use of cleared derivatives, exchange-traded derivatives, and OTC derivatives exposes us to counterparty credit risk. Our use of interest-rate swaps and option-based derivatives is subject to internal credit and legal reviews. On an ongoing basis, we review the credit fundamentals of all of our derivative counterparties, clearinghouses, and clearing members to confirm that they continue to meet our internal risk management standards.

Over-the-Counter Derivatives

We use master netting and collateral agreements to reduce our credit risk exposure to our OTC derivative counterparties. In the event that all of our counterparties for OTC derivatives were to default simultaneously on September 30, 2019, our maximum loss for accounting purposes after applying netting agreements and collateral on an individual counterparty basis would have been approximately $44 million.

Cleared and Exchange-Traded Derivatives

The majority of our interest-rate swaps are subject to the central clearing requirement of the Dodd-Frank Act. A reduction in our credit ratings could cause the clearinghouses or clearing members we use for our cleared and exchange-traded derivatives to demand additional collateral.

Other Derivatives

We also execute forward purchase and sale commitments of loans and mortgage-related securities, including dollar roll transactions, that are treated as derivatives for accounting purposes. The total net exposure on our forward purchase and sale commitments, which are treated as derivatives, was $195 million and $90 million at September 30, 2019 and December 31, 2018, respectively.

Many of our transactions involving forward purchase and sale commitments of mortgage-related securities utilize the Mortgage Backed Securities Division of the Fixed Income Clearing Corporation ("MBSD/FICC") as a clearinghouse. As a clearing member of the clearinghouse, we post margin to the MBSD/FICC and are exposed to the counterparty credit risk of the organization (including its clearing members).

Securities Purchased Under Agreements to Resell

As an investor, we enter into arrangements to purchase securities under agreements to subsequently resell the identical or substantially the same securities to our counterparty. Our counterparties to these transactions are required to pledge the purchased securities as collateral for their obligation to repurchase those securities at a later date. While such transactions involve the legal transfer of securities, they are accounted for as secured financings because the transferor does not relinquish effective control over the securities transferred. These agreements may allow us to repledge all or a portion of the collateral pledged to us, and we may repledge such collateral periodically, although it is not typically our practice to repledge collateral that has been pledged to us.

We consider the types of securities being pledged to us as collateral when determining how much we lend in transactions involving securities purchased under agreements to resell. Additionally, we regularly review the market values of these securities compared to amounts loaned in an effort to manage our exposure to losses.

Securities Sold Under Agreements to Repurchase

Securities sold under agreements to repurchase are effectively collateralized borrowings where we sell securities with an agreement to repurchase such securities at a future date. We are required to pledge the sold securities to the counterparties to these transactions as collateral for our obligation to repurchase these securities at a later date. Similar to the securities purchased under agreements to resell transactions, these transactions involve the legal transfer of securities. However, they are

accounted for as secured financings because they require the identical or substantially the same securities to be subsequently repurchased. These agreements may allow our counterparties to repledge all or a portion of the collateral.

Offsetting of Financial Assets and Liabilities

At September 30, 2019 and December 31, 2018, all amounts of cash collateral related to derivatives with master netting and collateral agreements were offset against derivative assets, net or derivative liabilities, net, as applicable.

The tables below display offsetting and collateral information related to derivatives, securities purchased under agreements to resell, and securities sold under agreements to repurchase which are subject to enforceable master netting agreements or similar arrangements. Securities sold under agreements to repurchase are included in debt, net on our condensed consolidated balance sheets.

Table 10.1 - Offsetting and Collateral Information of Financial Assets and Liabilities

	September 30, 2019
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$8,583			($5,373	)		($1,975	)		$1,235			($1,191	)		$44
Cleared and exchange-traded derivatives	29			(1		)	121			149			—			149
Other	208			—			—			208			—			208
Total derivatives	8,820			(5,374		)	(1,854		)	1,592			(1,191		)	401
Securities purchased under agreements to resell(3)	51,187			—			—			51,187			(51,187		)	—
Total		$60,007			($5,374	)		($1,854	)		$52,779			($52,378	)		$401
Liabilities:
Derivatives:
OTC derivatives		($7,029	)		$5,373			$1,601			($55	)		$—			($55	)
Cleared and exchange-traded derivatives	(23		)	1			19			(3		)	—			(3		)
Other	(297		)	—			—			(297		)	—			(297		)
Total derivatives	(7,349		)	5,374			1,620			(355		)	—			(355		)
Securities sold under agreements to repurchase(3)	(8,700		)	—			—			(8,700		)	8,700			—
Total		($16,049	)		$5,374			$1,620			($9,055	)		$8,700			($355	)

Referenced footnotes are included after the next table.

	December 31, 2018
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance  Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$7,213			($4,544	)		($2,448	)		$221			($173	)		$48
Cleared and exchange-traded derivatives	3			—			20			23			—			23
Other	91			—			—			91			—			91
Total derivatives	7,307			(4,544		)	(2,428		)	335			(173		)	162
Securities purchased under agreements to resell(3)	34,771			—			—			34,771			(34,771		)	—
Total		$42,078			($4,544	)		($2,428	)		$35,106			($34,944	)		$162
Liabilities:
Derivatives:
OTC derivatives		($4,963	)		$4,544			$296			($123	)		$—			($123	)
Cleared and exchange-traded derivatives	(244		)	—			101			(143		)	—			(143		)
Other	(317		)	—			—			(317		)	—			(317		)
Total derivatives	(5,524		)	4,544			397			(583		)	—			(583		)
Securities sold under agreements to repurchase(3)	(6,019		)	—			—			(6,019		)	6,019			—
Total		($11,543	)		$4,544			$397			($6,602	)		$6,019			($583	)

(1) Excess cash collateral held is presented as a derivative liability, while excess cash collateral posted is presented as a derivative asset.

(2) Does not include the fair value amount of non-cash collateral posted or held that exceeds the associated net asset or liability, netted by counterparty, presented on the condensed consolidated balance sheets. For cleared and exchange-traded derivatives, does not include non-cash collateral posted by us as initial margin with an aggregate fair value of $4.0 billion and $2.5 billion as of September 30, 2019 and December 31, 2018, respectively.

(3) Does not include the impacts of netting by central clearing organizations.

We primarily execute securities purchased under agreements to resell transactions with central clearing organizations where we have the right to repledge the collateral that has been pledged to us, either with the central clearing organization or with other counterparties. At September 30, 2019, and December 31, 2018, we had $27.6 billion and $20.1 billion, respectively, of securities pledged to us in these transactions. In addition, at September 30, 2019 and December 31, 2018, we had $2.2 billion and $2.5 billion, respectively, of securities pledged to us for transactions involving securities purchased under agreements to resell not executed with central clearing organizations that we had the right to repledge.

Collateral Pledged

Collateral Pledged to Freddie Mac

We have cash pledged to us as collateral primarily related to OTC derivative transactions. At September 30, 2019, we had $3.1 billion pledged to us as collateral that was invested as part of our liquidity and contingency operating portfolio.

Collateral Pledged by Freddie Mac

The tables below summarize the fair value of the securities pledged as collateral by us for derivatives and collateralized borrowing transactions, including securities that the secured party may repledge.

Table 10.2 - Collateral in the Form of Securities Pledged

	September 30, 2019
(In millions)	Derivatives		Securities sold under agreements to repurchase		Other(3)		Total
Cash equivalents(1)		$—		$284		$—		$284
Debt securities of consolidated trusts(2)	747		—		169		916
Available-for-sale securities	—		—		3		3
Trading securities	3,228		8,429		57		11,714
Total securities pledged		$3,975		$8,713		$229		$12,917

	December 31, 2018
(In millions)	Derivatives		Securities sold under agreements to repurchase		Other(3)		Total
Cash equivalents(1)		$—		$2,595		$—		$2,595
Debt securities of consolidated trusts(2)	362		—		179		541
Available-for-sale securities	—		—		1		1
Trading securities	2,160		3,432		73		5,665
Total securities pledged		$2,522		$6,027		$253		$8,802

(1) Represents U.S. Treasury securities accounted for as cash equivalents.

(2) Represents debt securities of consolidated trusts held by us in our Capital Markets segment mortgage investments portfolio which are recorded as a reduction to debt securities of consolidated trusts held by third parties on our condensed consolidated balance sheets.

(3) Includes other collateralized borrowings and collateral related to transactions with certain clearinghouses.

The table below summarizes the underlying collateral pledged and the remaining contractual maturity of our gross obligations under securities sold under agreements to repurchase.

Table 10.3 - Underlying Collateral Pledged

	September 30, 2019
(In millions)	Overnight and continuous		30 days or less		After 30 days through 90 days		Greater than 90 days		Total
U.S. Treasury securities and other		$2,684		$5,112		$917		$—		$8,713

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Credit Enhancements

9 Months Ended

Sep. 30, 2019

Credit Enhancements [Abstract]

CREDIT ENHANCEMENTS

Credit Enhancements

In connection with many of our mortgage loans, securitization activity guarantees, other mortgage-related guarantees, and other credit risk transfer transactions, we obtain various forms of credit enhancements that reduce our exposure to credit losses. These credit enhancements may be associated with mortgage loans or guarantees recognized on our condensed consolidated balance sheets or embedded in debt instruments recognized on our condensed consolidated balance sheets.

Mortgage Loan Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to our mortgage loan credit enhancements. For information about counterparty credit risk associated with credit enhancement providers, see Note 14.

Table 6.1 - Mortgage Loan Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage		Total Current and Protected UPB(1)		Maximum Coverage
Single-family:
Primary mortgage insurance		$410,999		$105,171		$378,594		$96,996
ACIS transactions(2)	869,148		10,081		807,885		9,123
STACR Trust transactions	280,889		9,154		161,152		5,026
Other	28,347		6,070		18,136		5,389
Total mortgage loan credit enhancements				$130,476				$116,534

(1) Underlying loans may be covered by more than one form of credit enhancement.

(2)

As of September 30, 2019 and December 31, 2018, our counterparties posted collateral on our ACIS transactions of $2.0 billion and $1.5 billion, respectively.

Guarantee Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to our single-family and multifamily guarantee credit enhancements.

Table 6.2 - Guarantee Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage(2)		Total Current and Protected UPB(1)		Maximum Coverage(2)
Single-family:
Subordination (non-consolidated VIEs)		$22,876		$4,076		$16,271		$2,933
Other	1,129		1,129		1,226		1,226
Total single-family			5,205				4,159
Multifamily:
Subordination (non-consolidated VIEs)	240,485		38,645		220,733		35,661
Other	3,204		919		2,349		815
Total multifamily			39,564				36,476
Total guarantee credit enhancements				$44,769				$40,635

(1) Underlying loans may be covered by more than one form of credit enhancement. For subordination, total current and protected UPB includes the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities, and the UPB of guarantor advances made to the holders of the guaranteed securities.

(2)

For subordination, maximum coverage represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties. For all other credit enhancements, maximum coverage represents the remaining amount of loss recovery that is available subject to the terms of counterparty agreements.

Debt with Embedded Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to debt with embedded credit enhancements.

Table 6.3 - Debt with Embedded Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage(2)		Total Current and Protected UPB(1)		Maximum Coverage(2)
Single-family:
STACR debt notes		$554,572		$15,962		$605,263		$17,596
Subordination (consolidated VIEs)	21,843		943		25,006		1,036
Total single-family			16,905				18,632
Multifamily:
SCR notes	2,523		126		2,667		133
Subordination (consolidated VIEs)	2,700		280		2,700		280
Total multifamily			406				413
Total debt with embedded credit enhancements				$17,311				$19,045

(1) Underlying loans may be covered by more than one form of credit enhancement. For STACR debt notes and SCR notes, total current and protected UPB represents the UPB of the assets included in the reference pool. For subordination, total current and protected UPB represents the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities.

(2) For STACR debt notes and SCR notes, maximum coverage amount represents the outstanding balance of the STACR debt notes and SCR notes held by third parties. For subordination, maximum coverage amount represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties.

Other Credit Enhancements

The Multifamily segment also has other credit enhancements in the form of collateral posting requirements, indemnification, pool insurance, bond insurance, recourse, and other similar arrangements. These credit enhancements, along with the proceeds received from the sale of the underlying mortgage collateral, are designed to recover all or a portion of our losses on our mortgage loans or the amounts paid under our financial guarantee contracts. Our historical losses and related recoveries pursuant to these agreements have not been significant and therefore these other types of credit enhancements are excluded from the tables above.

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Debt Securities and Subordinated Borrowings (Tables)

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Table - Total Debt, Net

The table below summarizes the balances of total debt, net per our condensed consolidated balance sheets and the interest expense per our condensed consolidated statements of comprehensive income.

Table 8.1 - Total Debt, Net

	Balance, Net				Interest Expense
(In millions)	September 30, 2019		December 31, 2018		3Q 2019		3Q 2018		YTD 2019		YTD 2018
Debt securities of consolidated trusts held by third parties		$1,869,308		$1,792,677		$13,324		$12,827		$41,001		$37,996
Other debt:
Short-term debt	94,344		51,080		499		361		1,419		832
Long-term debt	185,607		201,193		1,307		1,358		4,078		3,974
Total other debt	279,951		252,273		1,806		1,719		5,497		4,806
Total debt, net		$2,149,259		$2,044,950		$15,130		$14,546		$46,498		$42,802

Table - Debt Securities of Consolidated Trusts Held by Third Parties

The table below summarizes the debt securities of consolidated trusts held by third parties based on underlying loan product type.

Table 8.2 - Debt Securities of Consolidated Trusts Held by Third Parties

	September 30, 2019							December 31, 2018
(Dollars in millions)	Contractual Maturity	UPB		Carrying Amount(1)		Weighted Average Coupon(2)		Contractual Maturity	UPB		Carrying Amount(1)		Weighted Average Coupon(2)
Single-family:
30-year or more, fixed-rate	2019 - 2057		$1,487,105		$1,525,505	3.69	%	2019 - 2057		$1,389,113		$1,426,060	3.72	%
20-year fixed-rate	2019 - 2039	69,068		70,764		3.42		2019 - 2039	70,547		72,354		3.43
15-year fixed-rate	2019 - 2034	224,190		227,915		2.89		2019 - 2034	240,310		244,587		2.89
Adjustable-rate	2019 - 2049	32,837		33,474		3.28		2019 - 2049	38,361		39,153		3.12
Interest-only	2026 - 2041	4,608		4,677		4.72		2026 - 2048	5,322		5,386		4.41
FHA/VA	2020 - 2049	665		680		4.69		2019 - 2046	720		736		4.78
Total single-family		1,818,473		1,863,015					1,744,373		1,788,276
Multifamily	2020-2049	6,233		6,293		3.14		2019 - 2047	4,365		4,401		4.02
Total debt securities of consolidated trusts held by third parties			$1,824,706		$1,869,308					$1,748,738		$1,792,677

(1) Includes $737 million and $755 million at September 30, 2019 and December 31, 2018, respectively, of debt of consolidated trusts that represents the fair value of debt securities with the fair value option elected.

(2)

The effective interest rate for debt securities of consolidated trusts held by third parties was 2.81% and 3.07% as of September 30, 2019 and December 31, 2018, respectively.

Table - Other Debt

The table below summarizes the balances and effective interest rates for other debt.

Table 8.3 - Total Other Debt

	September 30, 2019						December 31, 2018
(Dollars in millions)	Par Value		Carrying Amount(1)		Weighted Average Effective Rate(2)		Par Value		Carrying Amount(1)			Weighted Average Effective Rate(2)
Other short-term debt:
Discount notes and Reference Bills		$42,719		$42,550	2.09	%		$28,787		$28,621		2.36	%
Medium-term notes	43,098		43,094		2.34		16,440		16,440			2.10
Securities sold under agreements to repurchase	8,700		8,700		2.06		6,019		6,019			2.40
Total other short-term debt	94,517		94,344		2.20		51,246		51,080			2.28
Other long-term debt:
Original maturities on or before December 31,
2019	12,442		12,435		1.63		58,002		57,968			1.54
2020	48,348		48,337		2.00		42,296		42,275			1.78
2021	36,669		36,669		2.05		30,898		30,901			2.06
2022	26,044		26,022		2.34		20,802		20,775			2.46
2023	10,064		10,045		2.65		15,929		15,906			3.09
Thereafter	37,392		34,994		3.68		18,068		15,579			5.91
STACR and SCR debt(3)	16,088		16,257		6.03		17,729		18,004			6.04
Hedging-related basis adjustments	N/A		848				N/A		(215		)
Total other long-term debt	187,047		185,607		2.74		203,724		201,193			2.58
Total other debt(4)		$281,564		$279,951				$254,970		$252,273

(1) Represents par value, net of associated discounts or premiums and issuance cost. Includes $3.9 billion and $4.4 billion at September 30, 2019 and December 31, 2018, respectively, of other long-term debt that represents the fair value of debt securities with the fair value option elected.

(2) Based on carrying amount.

(3) Contractual maturities of these debt securities are not presented because they are subject to prepayment risk, as their payments are based upon the performance of a pool of mortgage assets that may be prepaid by the related mortgage borrower at any time generally without penalty.

(4)

Carrying amount for other debt includes callable debt of $105.5 billion and $107.2 billion at September 30, 2019 and December 31, 2018, respectively.

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Segment Reporting (Tables)

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Table - Segment Earnings

The table below presents Segment Earnings by segment.

Table 13.1 - Segment Earnings

(In millions)	3Q 2019			3Q 2018		YTD 2019		YTD 2018
Segment Earnings (loss), net of taxes:
Single-family Guarantee		$1,250			$1,183		$2,945		$2,884
Multifamily	581			549		1,294		1,572
Capital Markets	(122		)	974		383		3,679
All Other	—			—		—		—
Total Segment Earnings, net of taxes	1,709			2,706		4,622		8,135
Net income (loss)		$1,709			$2,706		$4,622		$8,135
Comprehensive income (loss) of segments:
Single-family Guarantee		$1,247			$1,181		$2,936		$2,876
Multifamily	591			505		1,426		1,436
Capital Markets	10			873		977		2,832
All Other	—			—		—		—
Comprehensive income (loss) of segments	1,848			2,559		5,339		7,144
Comprehensive income (loss)		$1,848			$2,559		$5,339		$7,144

Table - Segment Earnings and Reconciliation to GAAP Condensed Consolidated Statements of Comprehensive Income

The tables below present detailed reconciliations between our GAAP condensed consolidated statements of comprehensive income and Segment Earnings for our reportable segments and All Other.

Table 13.2 - Segment Earnings and Reconciliations to GAAP Condensed Consolidated Statements of Comprehensive Income

	3Q 2019
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$292			$497			$—		$789			$1,621			$2,410
Guarantee fee income	2,075			233			—			—		2,308			(2,077		)	231
Benefit (provision) for credit losses	134			(1		)	—			—		133			46			179
Mortgage loans gains (losses)	—			1,087			—			—		1,087			615			1,702
Investment securities gains (losses)	—			31			136			—		167			(3		)	164
Debt gains (losses)	51			(69		)	(17		)	—		(35		)	(21		)	(56		)
Derivative gains (losses)	—			(793		)	(438		)	—		(1,231		)	14			(1,217		)
Other income (loss)	318			89			(234		)	—		173			(27		)	146
Administrative expense	(399		)	(125		)	(96		)	—		(620		)	—			(620		)
REO operations (expense) income	(61		)	—			—			—		(61		)	3			(58		)
Other non-interest (expense) income	(554		)	(17		)	(3		)	—		(574		)	(171		)	(745		)
Income tax (expense) benefit	(314		)	(146		)	33			—		(427		)	—			(427		)
Net income (loss)	1,250			581			(122		)	—		1,709			—			1,709
Changes in unrealized gains (losses) related to available-for-sale securities	—			10			114			—		124			—			124
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			19			—		19			—			19
Changes in defined benefit plans	(3		)	—			(1		)	—		(4		)	—			(4		)
Total other comprehensive income (loss), net of taxes	(3		)	10			132			—		139			—			139
Comprehensive income (loss)		$1,247			$591			$10			$—		$1,848			$—			$1,848
	YTD 2019
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$805			$2,002			$—		$2,807			$5,683			$8,490
Guarantee fee income	5,597			671			—			—		6,268			(5,598		)	670
Benefit (provision) for credit losses	221			(3		)	—			—		218			256			474
Mortgage loans gains (losses)	—			2,909			—			—		2,909			1,265			4,174
Investment securities gains (losses)	—			41			698			—		739			(11		)	728
Debt gains (losses)	113			(46		)	(27		)	—		40			(32		)	8
Derivative gains (losses)	(47		)	(2,650		)	(2,095		)	—		(4,792		)	(120		)	(4,912		)
Other income (loss)	836			292			198			—		1,326			(937		)	389
Administrative expense	(1,173		)	(357		)	(287		)	—		(1,817		)	—			(1,817		)
REO operations (expense) income	(185		)	—			—			—		(185		)	13			(172		)
Other non-interest (expense) income	(1,667		)	(38		)	(9		)	—		(1,714		)	(519		)	(2,233		)
Income tax (expense) benefit	(750		)	(330		)	(97		)	—		(1,177		)	—			(1,177		)
Net income (loss)	2,945			1,294			383			—		4,622			—			4,622
Changes in unrealized gains (losses) related to available-for-sale securities	—			134			540			—		674			—			674
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			57			—		57			—			57
Changes in defined benefit plans	(9		)	(2		)	(3		)	—		(14		)	—			(14		)
Total other comprehensive income (loss), net of taxes	(9		)	132			594			—		717			—			717
Comprehensive income (loss)		$2,936			$1,426			$977			$—		$5,339			$—			$5,339

	3Q 2018
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$280			$845			$—		$1,125			$2,132			$3,257
Guarantee fee income	1,676			210			—			—		1,886			(1,677		)	209
Benefit (provision) for credit losses	205			2			—			—		207			173			380
Mortgage loans gains (losses)	—			(17		)	—			—		(17		)	111			94
Investment securities gains (losses)	—			(97		)	(336		)	—		(433		)	(10		)	(443		)
Debt gains (losses)	20			5			137			—		162			(4		)	158
Derivative gains (losses)	(25		)	375			427			—		777			(49		)	728
Other income (loss)	387			27			179			—		593			(514		)	79
Administrative expense	(371		)	(109		)	(89		)	—		(569		)	—			(569		)
REO operations (expense) income	(42		)	—			—			—		(42		)	4			(38		)
Other non-interest (expense) income	(413		)	(14		)	—			—		(427		)	(166		)	(593		)
Income tax (expense) benefit	(254		)	(113		)	(189		)	—		(556		)	—			(556		)
Net income (loss)	1,183			549			974			—		2,706			—			2,706
Changes in unrealized gains (losses) related to available-for-sale securities	—			(44		)	(125		)	—		(169		)	—			(169		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			25			—		25			—			25
Changes in defined benefit plans	(2		)	—			(1		)	—		(3		)	—			(3		)
Total other comprehensive income (loss), net of taxes	(2		)	(44		)	(101		)	—		(147		)	—			(147		)
Comprehensive income (loss)		$1,181			$505			$873			$—		$2,559			$—			$2,559
	YTD 2018
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$846			$2,410			$—		$3,256			$6,022			$9,278
Guarantee fee income	4,932			609			—			—		5,541			(4,938		)	603
Benefit (provision) for credit losses	366			20			—			—		386			(9		)	377
Mortgage loans gains (losses)	—			(233		)	—			—		(233		)	466			233
Investment securities gains (losses)	—			(353		)	(524		)	—		(877		)	(147		)	(1,024		)
Debt gains (losses)	80			22			368			—		470			(25		)	445
Derivative gains (losses)	(37		)	1,254			2,038			—		3,255			(281		)	2,974
Other income (loss)	592			128			541			—		1,261			(613		)	648
Administrative expense	(1,070		)	(315		)	(262		)	—		(1,647		)	—			(1,647		)
REO operations (expense) income	(101		)	1			—			—		(100		)	13			(87		)
Other non-interest (expense) income	(1,192		)	(33		)	(6		)	—		(1,231		)	(488		)	(1,719		)
Income tax (expense) benefit	(686		)	(374		)	(886		)	—		(1,946		)	—			(1,946		)
Net income (loss)	2,884			1,572			3,679			—		8,135			—			8,135
Changes in unrealized gains (losses) related to available-for-sale securities	—			(134		)	(931		)	—		(1,065		)	—			(1,065		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			87			—		87			—			87
Changes in defined benefit plans	(8		)	(2		)	(3		)	—		(13		)	—			(13		)
Total other comprehensive income (loss), net of taxes	(8		)	(136		)	(847		)	—		(991		)	—			(991		)
Comprehensive income (loss)		$2,876			$1,436			$2,832			$—		$7,144			$—			$7,144

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Selected Financial Statement Line Items (Tables)

9 Months Ended

Sep. 30, 2019

Selected Financial Statement Data [Abstract]

Table - Significant Components of Other Income (Loss)

The table below presents the significant components of other income (loss) on our condensed consolidated statements of comprehensive income (loss).

Table 18.1 - Significant Components of Other Income (Loss)

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Other income (loss):
Income on guarantee obligation		$206			$176			$593			$524
All other	(60		)	(97		)	(204		)	124
Total other income (loss)		$146			$79			$389			$648

Table - Significant Components of Other Assets and Other Liabilities

The table below presents the significant components of other assets and other liabilities on our condensed consolidated balance sheets.

Table 18.2 - Significant Components of Other Assets and Other Liabilities

(In millions)	September 30, 2019		December 31, 2018
Other assets:
Real estate owned, net		$607		$769
Accounts and other receivables(1)	12,816		2,447
Guarantee asset	4,225		3,633
Secured lending and other	5,439		1,805
All other	2,626		2,322
Total other assets		$25,713		$10,976
Other liabilities:
Guarantee obligation		$4,055		$3,561
All other	3,215		2,837
Total other liabilities		$7,270		$6,398

(1)

Primarily consists of servicer receivables and other non-interest receivables.

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Credit Enhancements - Guaranteed Credit Enhancements (Details) - Guarantee Credit Enhancements - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Credit Enhancement [Line Items]
Maximum coverage	$ 44,769	$ 40,635
Single-family
Credit Enhancement [Line Items]
Maximum coverage	5,205	4,159
Single-family | Non-consolidated VIE subordination
Credit Enhancement [Line Items]
Total current and protected UPB	22,876	16,271
Maximum coverage	4,076	2,933
Single-family | Other
Credit Enhancement [Line Items]
Total current and protected UPB	1,129	1,226
Maximum coverage	1,129	1,226
Multifamily
Credit Enhancement [Line Items]
Maximum coverage	39,564	36,476
Multifamily | Non-consolidated VIE subordination
Credit Enhancement [Line Items]
Total current and protected UPB	240,485	220,733
Maximum coverage	38,645	35,661
Multifamily | Other
Credit Enhancement [Line Items]
Total current and protected UPB	3,204	2,349
Maximum coverage	$ 919	$ 815

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Mortgage Loans and Loan Loss Reserves - Payment Defaults of Completed TDR Modifications (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($) numberofloans	Sep. 30, 2018 USD ($) numberofloans	Sep. 30, 2019 USD ($) numberofloans	Sep. 30, 2018 USD ($) numberofloans
Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Modifications and Other Loss Mitigation Activities
Number of Loans, Modifications, Subsequent Default | numberofloans	3,256	3,584	10,533	9,671
Post-TDR Recorded Investment, Modifications, Subsequent Default | $	$ 407	$ 512	$ 1,237	$ 1,435
Single-family 15-year amortizing fixed-rate
Financing Receivable, Modifications and Other Loss Mitigation Activities
Number of Loans, Modifications, Subsequent Default | numberofloans	96	116	329	435
Post-TDR Recorded Investment, Modifications, Subsequent Default | $	$ 9	$ 10	$ 24	$ 36
Single-family Adjustable-rate
Financing Receivable, Modifications and Other Loss Mitigation Activities
Number of Loans, Modifications, Subsequent Default | numberofloans	33	53	95	139
Post-TDR Recorded Investment, Modifications, Subsequent Default | $	$ 3	$ 9	$ 10	$ 21
Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Modifications and Other Loss Mitigation Activities
Number of Loans, Modifications, Subsequent Default | numberofloans	178	302	687	827
Post-TDR Recorded Investment, Modifications, Subsequent Default | $	$ 24	$ 55	$ 96	$ 154
Single-family
Financing Receivable, Modifications and Other Loss Mitigation Activities
Number of Loans, Modifications, Subsequent Default | numberofloans	3,563	4,055	11,644	11,072
Post-TDR Recorded Investment, Modifications, Subsequent Default | $	$ 443	$ 586	$ 1,367	$ 1,646
Multifamily
Financing Receivable, Modifications and Other Loss Mitigation Activities
Number of Loans, Modifications, Subsequent Default | numberofloans	0	0	0	0
Post-TDR Recorded Investment, Modifications, Subsequent Default | $	$ 0	$ 0	$ 0	$ 0

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Mortgage Loans and Loan Loss Reserves - Detail of Allowance for Credit Losses (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Rollforward of Allowance for Loan Losses
Ending balance	$ 4,905	$ 7,002	$ 4,905	$ 7,002
Reserve for guarantee losses
Rollforward of Allowance for Loan Losses
Beginning balance			52
Ending balance	51	56	51	56
Held by Freddie Mac | Allowance for loan losses
Rollforward of Allowance for Loan Losses
Ending balance	2,017	3,610	2,017	3,610
Held by consolidated trusts | Allowance for loan losses
Rollforward of Allowance for Loan Losses
Ending balance	2,837	3,336	2,837	3,336
Single-family
Rollforward of Allowance for Loan Losses
Beginning balance	5,326	8,433	6,176	8,979
Provision (benefit) for credit losses	(180)	(378)	(477)	(357)
Charge-offs	(407)	(1,277)	(1,256)	(2,248)
Recoveries	107	119	341	341
Transfers, net	0	0	0	0
Other	41	87	103	269
Ending balance	4,887	6,984	4,887	6,984
Single-family | Reserve for guarantee losses
Rollforward of Allowance for Loan Losses
Beginning balance	46	49	46	48
Provision (benefit) for credit losses	1	1	3	6
Charge-offs	(1)	(2)	(3)	(6)
Recoveries	0	0	0	0
Transfers, net	0	0	0	0
Other	0	0	0	0
Ending balance	46	48	46	48
Single-family | Held by Freddie Mac | Allowance for loan losses
Rollforward of Allowance for Loan Losses
Beginning balance	2,238	4,887	3,003	5,251
Provision (benefit) for credit losses	(84)	(522)	(509)	(629)
Charge-offs	(394)	(1,262)	(1,208)	(2,198)
Recoveries	104	117	331	336
Transfers, net	103	306	291	597
Other	41	76	100	245
Ending balance	2,008	3,602	2,008	3,602
Single-family | Held by consolidated trusts | Allowance for loan losses
Rollforward of Allowance for Loan Losses
Beginning balance	3,042	3,497	3,127	3,680
Provision (benefit) for credit losses	(97)	143	29	266
Charge-offs	(12)	(13)	(45)	(44)
Recoveries	3	2	10	5
Transfers, net	(103)	(306)	(291)	(597)
Other	0	11	3	24
Ending balance	2,833	3,334	2,833	3,334
Multifamily
Rollforward of Allowance for Loan Losses
Ending balance	18	18	18	18
Multifamily | Reserve for guarantee losses
Rollforward of Allowance for Loan Losses
Ending balance	5	8	5	8
Multifamily | Held by Freddie Mac | Allowance for loan losses
Rollforward of Allowance for Loan Losses
Ending balance	9	8	9	8
Multifamily | Held by consolidated trusts | Allowance for loan losses
Rollforward of Allowance for Loan Losses
Ending balance	$ 4	$ 2	$ 4	$ 2

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Consolidated Statements of Comprehensive Income (Loss) - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Interest income
Mortgage loans	$ 16,428	$ 16,787	$ 51,732	$ 49,082
Investments in securities	686	755	2,059	2,295
Other	426	261	1,197	703
Total interest income	17,540	17,803	54,988	52,080
Interest expense	(15,130)	(14,546)	(46,498)	(42,802)
Net interest income	2,410	3,257	8,490	9,278
Benefit (provision) for credit losses	179	380	474	377
Net interest income after benefit (provision) for credit losses	2,589	3,637	8,964	9,655
Non-interest income (loss)
Guarantee fee income	231	209	670	603
Mortgage loans gains (losses)	1,702	94	4,174	233
Investment securities gains (losses)	164	(443)	728	(1,024)
Debt gains (losses)	(56)	158	8	445
Derivative gains (losses)	(1,217)	728	(4,912)	2,974
Other income (loss)	146	79	389	648
Non-interest income (loss)	970	825	1,057	3,879
Non-interest expense
Salaries and employee benefits	(333)	(301)	(983)	(890)
Professional services	(115)	(120)	(342)	(335)
Other administrative expense	(172)	(148)	(492)	(422)
Total administrative expense	(620)	(569)	(1,817)	(1,647)
Real estate owned operations expense	(58)	(38)	(172)	(87)
Temporary Payroll Tax Cut Continuation Act of 2011 expense	(408)	(375)	(1,197)	(1,100)
Other expense	(337)	(218)	(1,036)	(619)
Non-interest expense	(1,423)	(1,200)	(4,222)	(3,453)
Income (loss) before income tax (expense) benefit	2,136	3,262	5,799	10,081
Income tax (expense) benefit	(427)	(556)	(1,177)	(1,946)
Net income (loss)	1,709	2,706	4,622	8,135
Other comprehensive income (loss), net of taxes and reclassification adjustments:
Changes in unrealized gains (losses) related to available-for-sale securities	124	(169)	674	(1,065)
Changes in unrealized gains (losses) related to cash flow hedge relationships	19	25	57	87
Changes in defined benefit plans	(4)	(3)	(14)	(13)
Total other comprehensive income (loss), net of taxes and reclassification adjustments	139	(147)	717	(991)
Comprehensive income (loss)	1,848	2,559	5,339	7,144
Net income (loss)	1,709	2,706	4,622	8,135
Undistributed net worth sweep, senior preferred stock dividends, or future increase in senior preferred stock liquidation preference	(1,848)	(2,559)	(5,339)	(4,144)
Net income (loss) attributable to common stockholders	$ (139)	$ 147	$ (717)	$ 3,991
Net income (loss) per common share — basic and diluted	$ (0.04)	$ 0.05	$ (0.22)	$ 1.23
Weighted average common shares outstanding (in millions) — basic and diluted	3,234	3,234	3,234	3,234

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Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Net Cash Provided by (Used in) Operating Activities	$ 3,404,000,000	$ 2,895,000,000
Cash flows from investing activities
Purchases of trading securities	(76,091,000,000)	(101,700,000,000)
Proceeds from sales of trading securities	61,398,000,000	94,934,000,000
Proceeds from maturities and repayments of trading securities	10,733,000,000	5,276,000,000
Purchases of available-for-sale securities	(6,440,000,000)	(14,308,000,000)
Proceeds from sales of available-for-sale securities	9,407,000,000	16,976,000,000
Proceeds from maturities and repayments of available-for-sale securities	3,201,000,000	4,740,000,000
Purchases of held-for-investment mortgage loans	(154,441,000,000)	(113,083,000,000)
Proceeds from sales of mortgage loans held-for-investment	11,063,000,000	7,121,000,000
Repayments of mortgage loans held-for-investment	232,374,000,000	190,264,000,000
Advances under secured lending arrangements	(34,627,000,000)	(19,407,000,000)
Repayments of secured lending arrangements	1,022,000,000	0
Net proceeds from dispositions of real estate owned and other recoveries	891,000,000	1,054,000,000
Net (increase) decrease in securities purchased under agreements to resell	(16,416,000,000)	7,363,000,000
Derivative premiums and terminations, swap collateral, and exchange settlement payments, net	(10,536,000,000)	5,418,000,000
Other, net	(424,000,000)	(321,000,000)
Net Cash Provided by (Used in) Investing Activities	31,114,000,000	84,327,000,000
Cash flows from financing activities
Increase in liquidation preference of senior preferred stock	0	312,000,000
Payment of cash dividends on senior preferred stock	(3,142,000,000)	(1,585,000,000)
Other, net	(84,000,000)	(2,000,000)
Net Cash Provided by (Used in) Financing Activities	(33,083,000,000)	(89,995,000,000)
Net increase (decrease) in cash and cash equivalents (includes restricted cash and cash equivalents)	1,435,000,000	(2,773,000,000)
Cash and cash equivalents (includes restricted cash and cash equivalents) at beginning of year	7,273,000,000	9,811,000,000
Cash and cash equivalents (includes restricted cash and cash equivalents) at end of period	8,708,000,000	7,038,000,000
Cash paid for:
Debt interest	52,720,000,000	48,915,000,000
Income taxes	306,000,000	2,125,000,000
Held by Freddie Mac
Cash flows from financing activities
Proceeds from issuance of debt	631,628,000,000	444,809,000,000
Repayments of debt	(605,323,000,000)	(480,625,000,000)
Held by consolidated trusts
Cash flows from financing activities
Proceeds from issuance of debt	178,248,000,000	158,825,000,000
Repayments of debt	(234,410,000,000)	$ (211,729,000,000)
Cash and cash equivalents (includes restricted cash and cash equivalents) at beginning of year	567,000,000
Cash and cash equivalents (includes restricted cash and cash equivalents) at end of period	$ 3,495,000,000

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Stockholders' Equity and Earnings per Share - Senior Preferred Stock (Details) - USD ($) $ / shares in Units, shares in Thousands													9 Months Ended
	Mar. 30, 2018	Jun. 29, 2012	Mar. 30, 2012	Dec. 30, 2011	Sep. 30, 2011	Mar. 31, 2011	Dec. 30, 2010	Sep. 30, 2010	Jun. 30, 2010	Jun. 30, 2009	Mar. 31, 2009	Nov. 24, 2008	Sep. 30, 2018	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2018	Dec. 31, 2017	Sep. 08, 2008
Class of Stock [Line Items]
Increase in liquidation preference													$ 312,000,000
Aggregate liquidation preference on senior preferred stock														$ 77,474,000,000	$ 75,600,000,000	$ 75,648,000,000
Senior Preferred Stock
Class of Stock [Line Items]
Shares Authorized														1,000
Shares Outstanding														1,000
Total Par Value														$ 1,000,000.00
Initial Liquidation Preference Of Senior Preferred Stock																		$ 1,000,000,000
Initial Liquidation Preference Price Per Share														$ 1,000
Increase in Senior Preferred Stock																	$ 3,000,000,000
Increase in liquidation preference due to net worth increase														$ 1,826,000,000
Increase in liquidation preference	$ 312,000,000	$ 19,000,000	$ 146,000,000	$ 5,992,000,000	$ 1,479,000,000	$ 500,000,000	$ 100,000,000	$ 1,800,000,000	$ 10,600,000,000	$ 6,100,000,000	$ 30,800,000,000	$ 13,800,000,000
Aggregate liquidation preference on senior preferred stock														$ 77,474,000,000

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Derivatives Derivatives - Gains and Losses on Fair Value Hedge (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Interest Income - Mortgage Loans	$ 16,428	$ 16,787	$ 51,732	$ 49,082
Interest Expense	(15,130)	(14,546)	(46,498)	(42,802)
Interest rate risk on held-for-investment mortgage loans | Interest income
Derivative Instruments, Gain (Loss) [Line Items]
Change in Unrealized Gain (Loss) on Fair Value Hedging Instruments	(1,588)	776	(5,609)	3,087
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge	1,298	(755)	5,691	(3,441)
Interest accrual on fair value hedging derivatives for held-for-investment loans	(48)	(96)	(4)	(373)
Discontinued hedge related basis adjustment amortization	(210)	38	(229)	86
Interest rate risk on debt | Interest expense
Derivative Instruments, Gain (Loss) [Line Items]
Change in Unrealized Gain (Loss) on Fair Value Hedging Instruments	91	(50)	1,288	(728)
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge	(36)	121	(1,141)	931
Interest accrual on fair value hedging derivatives for debt	(18)	(96)	(230)	(219)
Discontinued hedge related basis adjustment amortization	$ 18	$ (1)	$ 43	$ (2)

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Collateral and Offsetting of Assets and Liabilities - Offsetting of Financial Liabilities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Derivative Liabilities:
Gross Amount Recognized	$ (7,349)	$ (5,524)
Counterparty netting	5,374	4,544
Cash collateral netting	1,620	397
Derivative liabilities, net	(355)	(583)
Gross Amount Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	(355)	(583)
Securities Sold under Agreements to Repurchase [Abstract]
Gross Amount Recognized	(8,700)	(6,019)
Counterparty netting	0	0
Net Amount Presented in the Consolidated Balance Sheets	(8,700)	(6,019)
Gross Amount Not Offset in the Consolidated Balance Sheets	8,700	6,019
Net Amount	0	0
Offsetting Derivative Liability, Securities Sold under Agreements to Repurchase, Securities Loaned [Abstract]
Gross Amount Recognized	(16,049)	(11,543)
Counterparty netting	5,374	4,544
Cash collateral netting	(1,620)	(397)
Net Amount Presented in the Consolidated Balance Sheets	(9,055)	(6,602)
Gross Amount Not Offset in the Consolidated Balance Sheets	8,700	6,019
Net Amount	(355)	(583)
Other
Derivative Liabilities:
Gross Amount Recognized	(297)	(317)
Counterparty netting	0	0
Cash collateral netting	0	0
Derivative liabilities, net	(297)	(317)
Gross Amount Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	(297)	(317)
OTC derivatives
Derivative Liabilities:
Gross Amount Recognized	(7,029)	(4,963)
Counterparty netting	5,373	4,544
Cash collateral netting	1,601	296
Derivative liabilities, net	(55)	(123)
Gross Amount Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	(55)	(123)
Cleared and exchange-traded derivatives
Derivative Liabilities:
Gross Amount Recognized	(23)	(244)
Counterparty netting	1	0
Cash collateral netting	19	101
Derivative liabilities, net	(3)	(143)
Gross Amount Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	(3)	(143)
Offsetting Derivative Liability, Securities Sold under Agreements to Repurchase, Securities Loaned [Abstract]
Aggregate fair value of securities posted	4,000	2,500
Securities Sold under Agreements to Repurchase
Offsetting Derivative Liability, Securities Sold under Agreements to Repurchase, Securities Loaned [Abstract]
Cash collateral netting	$ 0	$ 0

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Segment Reporting - Segment Earnings and Reconciliation to GAAP Condensed Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	$ 2,410	$ 3,257	$ 8,490	$ 9,278
Benefit (provision) for credit losses	179	380	474	377
Non-interest income (loss)
Guarantee fee income	231	209	670	603
Mortgage loans gains (losses)	1,702	94	4,174	233
Investment securities gains (losses)	164	(443)	728	(1,024)
Debt gains (losses)	(56)	158	8	445
Derivative gains (losses)	(1,217)	728	(4,912)	2,974
Other income (loss)	146	79	389	648
Non-interest expense
Administrative expense	(620)	(569)	(1,817)	(1,647)
REO operations (expense) income	(58)	(38)	(172)	(87)
Other non interest (expense) income	(745)	(593)	(2,233)	(1,719)
Income tax (expense) benefit	(427)	(556)	(1,177)	(1,946)
Net income (loss)	1,709	2,706	4,622	8,135
Changes in unrealized gains (losses) related to available-for-sale securities	124	(169)	674	(1,065)
Changes in unrealized gains (losses) related to cash flow hedge relationships	19	25	57	87
Changes in defined benefit plans	(4)	(3)	(14)	(13)
Total other comprehensive income (loss), net of taxes	139	(147)	717	(991)
Comprehensive income (loss)	1,848	2,559	5,339	7,144
All Other
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	0	0	0	0
Benefit (provision) for credit losses	0	0	0	0
Non-interest income (loss)
Guarantee fee income	0	0	0	0
Mortgage loans gains (losses)	0	0	0	0
Investment securities gains (losses)	0	0	0	0
Debt gains (losses)	0	0	0	0
Derivative gains (losses)	0	0	0	0
Other income (loss)	0	0	0	0
Non-interest expense
Administrative expense	0	0	0	0
REO operations (expense) income	0	0	0	0
Other non interest (expense) income	0	0	0	0
Income tax (expense) benefit	0	0	0	0
Net income (loss)	0	0	0	0
Changes in unrealized gains (losses) related to available-for-sale securities	0	0	0	0
Changes in unrealized gains (losses) related to cash flow hedge relationships	0	0	0	0
Changes in defined benefit plans	0	0	0	0
Total other comprehensive income (loss), net of taxes	0	0	0	0
Comprehensive income (loss)	0	0	0	0
Reclassifications
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	1,621	2,132	5,683	6,022
Benefit (provision) for credit losses	46	173	256	(9)
Non-interest income (loss)
Guarantee fee income	(2,077)	(1,677)	(5,598)	(4,938)
Mortgage loans gains (losses)	615	111	1,265	466
Investment securities gains (losses)	(3)	(10)	(11)	(147)
Debt gains (losses)	(21)	(4)	(32)	(25)
Derivative gains (losses)	14	(49)	(120)	(281)
Other income (loss)	(27)	(514)	(937)	(613)
Non-interest expense
Administrative expense	0	0	0	0
REO operations (expense) income	3	4	13	13
Other non interest (expense) income	(171)	(166)	(519)	(488)
Income tax (expense) benefit	0	0	0	0
Net income (loss)	0	0	0	0
Changes in unrealized gains (losses) related to available-for-sale securities	0	0	0	0
Changes in unrealized gains (losses) related to cash flow hedge relationships	0	0	0	0
Changes in defined benefit plans	0	0	0	0
Total other comprehensive income (loss), net of taxes	0	0	0	0
Comprehensive income (loss)	0	0	0	0
Single-family Guarantee | Operating segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	0	0	0	0
Benefit (provision) for credit losses	134	205	221	366
Non-interest income (loss)
Guarantee fee income	2,075	1,676	5,597	4,932
Mortgage loans gains (losses)	0	0	0	0
Investment securities gains (losses)	0	0	0	0
Debt gains (losses)	51	20	113	80
Derivative gains (losses)	0	(25)	(47)	(37)
Other income (loss)	318	387	836	592
Non-interest expense
Administrative expense	(399)	(371)	(1,173)	(1,070)
REO operations (expense) income	(61)	(42)	(185)	(101)
Other non interest (expense) income	(554)	(413)	(1,667)	(1,192)
Income tax (expense) benefit	(314)	(254)	(750)	(686)
Net income (loss)	1,250	1,183	2,945	2,884
Changes in unrealized gains (losses) related to available-for-sale securities	0	0	0	0
Changes in unrealized gains (losses) related to cash flow hedge relationships	0	0	0	0
Changes in defined benefit plans	(3)	(2)	(9)	(8)
Total other comprehensive income (loss), net of taxes	(3)	(2)	(9)	(8)
Comprehensive income (loss)	1,247	1,181	2,936	2,876
Multifamily | Operating segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	292	280	805	846
Benefit (provision) for credit losses	(1)	2	(3)	20
Non-interest income (loss)
Guarantee fee income	233	210	671	609
Mortgage loans gains (losses)	1,087	(17)	2,909	(233)
Investment securities gains (losses)	31	(97)	41	(353)
Debt gains (losses)	(69)	5	(46)	22
Derivative gains (losses)	(793)	375	(2,650)	1,254
Other income (loss)	89	27	292	128
Non-interest expense
Administrative expense	(125)	(109)	(357)	(315)
REO operations (expense) income	0	0	0	1
Other non interest (expense) income	(17)	(14)	(38)	(33)
Income tax (expense) benefit	(146)	(113)	(330)	(374)
Net income (loss)	581	549	1,294	1,572
Changes in unrealized gains (losses) related to available-for-sale securities	10	(44)	134	(134)
Changes in unrealized gains (losses) related to cash flow hedge relationships	0	0	0	0
Changes in defined benefit plans	0	0	(2)	(2)
Total other comprehensive income (loss), net of taxes	10	(44)	132	(136)
Comprehensive income (loss)	591	505	1,426	1,436
Capital Markets | Operating segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	497	845	2,002	2,410
Benefit (provision) for credit losses	0	0	0	0
Non-interest income (loss)
Guarantee fee income	0	0	0	0
Mortgage loans gains (losses)	0	0	0	0
Investment securities gains (losses)	136	(336)	698	(524)
Debt gains (losses)	(17)	137	(27)	368
Derivative gains (losses)	(438)	427	(2,095)	2,038
Other income (loss)	(234)	179	198	541
Non-interest expense
Administrative expense	(96)	(89)	(287)	(262)
REO operations (expense) income	0	0	0	0
Other non interest (expense) income	(3)	0	(9)	(6)
Income tax (expense) benefit	33	(189)	(97)	(886)
Net income (loss)	(122)	974	383	3,679
Changes in unrealized gains (losses) related to available-for-sale securities	114	(125)	540	(931)
Changes in unrealized gains (losses) related to cash flow hedge relationships	19	25	57	87
Changes in defined benefit plans	(1)	(1)	(3)	(3)
Total other comprehensive income (loss), net of taxes	132	(101)	594	(847)
Comprehensive income (loss)	10	873	977	2,832
Operating segments and All Other
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Net interest Income	789	1,125	2,807	3,256
Benefit (provision) for credit losses	133	207	218	386
Non-interest income (loss)
Guarantee fee income	2,308	1,886	6,268	5,541
Mortgage loans gains (losses)	1,087	(17)	2,909	(233)
Investment securities gains (losses)	167	(433)	739	(877)
Debt gains (losses)	(35)	162	40	470
Derivative gains (losses)	(1,231)	777	(4,792)	3,255
Other income (loss)	173	593	1,326	1,261
Non-interest expense
Administrative expense	(620)	(569)	(1,817)	(1,647)
REO operations (expense) income	(61)	(42)	(185)	(100)
Other non interest (expense) income	(574)	(427)	(1,714)	(1,231)
Income tax (expense) benefit	(427)	(556)	(1,177)	(1,946)
Net income (loss)	1,709	2,706	4,622	8,135
Changes in unrealized gains (losses) related to available-for-sale securities	124	(169)	674	(1,065)
Changes in unrealized gains (losses) related to cash flow hedge relationships	19	25	57	87
Changes in defined benefit plans	(4)	(3)	(14)	(13)
Total other comprehensive income (loss), net of taxes	139	(147)	717	(991)
Comprehensive income (loss)	$ 1,848	$ 2,559	$ 5,339	$ 7,144

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Securitization Activities and Consolidation - Consolidated VIEs (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018	Dec. 31, 2017
Variable Interest Entity, Consolidated, Carrying Amount, Assets [Abstract]
Cash and cash equivalents	$ 8,708	$ 7,273	$ 7,038	$ 9,811
Restricted cash and cash equivalents	3,560	596
Securities purchased under agreement to resell	51,187	34,771
Investments in securities, at fair value	72,982	69,111
Mortgage loans held-for-investment	1,956,372	1,885,356
Accrued interest receivable	6,790	6,728
Other assets	25,713	10,976
Total assets	2,170,246	2,063,060
Variable Interest Entity, Consolidated, Carrying Amount, Liabilities [Abstract]
Accrued interest payable	6,688	6,652
Debt, net	2,149,259	2,044,950
Total liabilities	2,163,572	2,058,583
Held by consolidated trusts
Variable Interest Entity, Consolidated, Carrying Amount, Assets [Abstract]
Cash and cash equivalents	3,495	567
Restricted cash and cash equivalents	3,494	566
Securities purchased under agreement to resell	21,400	12,125
Investments in securities, at fair value	766	0
Mortgage loans held-for-investment	1,905,633	1,842,850
Accrued interest receivable	6,109	5,914
Other assets	12,093	1,631
Total assets	1,949,496	1,863,087
Variable Interest Entity, Consolidated, Carrying Amount, Liabilities [Abstract]
Accrued interest payable	5,519	5,335
Debt, net	1,869,308	1,792,677
Total liabilities	$ 1,874,827	$ 1,798,012

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Mortgage Loans and Loan Loss Reserves Mortgage Loans and Loan Loss Reserves - Loans Purchased, Reclassified from Held-for-Investment to Held-for-Sale and Sold (Details) - USD ($) $ in Billions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Single-family | Held-for-Investment
Financing Receivable, Allowance for Credit Loss [Line Items]
Financing Receivable, Purchase	$ 133.8	$ 81.6	$ 305.0	$ 231.5
Financing Receivable, Reclassification to Held-for-sale	3.0	13.3	8.1	17.6
Single-family | Held-for-Sale
Financing Receivable, Allowance for Credit Loss [Line Items]
Financing Receivable, Sale	3.7	2.3	9.4	6.5
Multifamily | Held-for-Investment
Financing Receivable, Allowance for Credit Loss [Line Items]
Financing Receivable, Purchase	4.4	0.9	6.8	2.6
Financing Receivable, Reclassification to Held-for-sale	0.4	0.2	1.2	0.7
Multifamily | Held-for-Sale
Financing Receivable, Allowance for Credit Loss [Line Items]
Financing Receivable, Purchase	23.1	16.3	50.6	42.5
Financing Receivable, Sale	$ 19.7	$ 14.4	$ 49.5	$ 44.8

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Mortgage Loans and Loan Loss Reserves - Delinquency Rates (Details) $ in Millions	Sep. 30, 2019 USD ($) numberofloans	Dec. 31, 2018 USD ($) numberofloans
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Serious delinquency rate	0.61%	0.69%
Single-family
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Serious delinquency rate	0.61%	0.69%
Total number of seriously delinquent loans	67,991	75,649
Single-family | Non-credit-enhanced portfolio
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Serious delinquency rate	0.72%	0.83%
Total number of seriously delinquent loans	42,758	51,197
Single-family | Credit-enhanced portfolio | Primary mortgage insurance
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Serious delinquency rate	0.76%	0.86%
Total number of seriously delinquent loans	14,358	15,287
Single-family | Credit-enhanced portfolio | Other credit protection
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Serious delinquency rate	0.34%	0.31%
Total number of seriously delinquent loans	15,736	12,920
Multifamily
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Delinquency Rate	0.04%	0.01%
UPB of delinquent loans | $	$ 106	$ 30
Multifamily | Non-credit-enhanced portfolio
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Delinquency Rate	0.01%	0.00%
UPB of delinquent loans | $	$ 3	$ 2
Multifamily | Credit-enhanced portfolio
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Delinquency Rate	0.04%	0.01%
UPB of delinquent loans | $	$ 103	$ 28

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Fair Value Disclosures - Quantitative Information about Recurring Level 3 Fair Value Measurements (Details) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2019 USD ($)	Dec. 31, 2018 USD ($)
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	$ 28,533	$ 33,563
Liabilities [Abstract]
Debt instrument recorded at fair value	4,600	5,112
Held by consolidated trusts
Liabilities [Abstract]
Debt instrument recorded at fair value	737	755
Freddie Mac
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	26,119	30,199
Non-agency and other
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	1,388	1,658
Fair Value, Measurements, Recurring
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	28,533	33,563
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	44,449	35,548
Other assets:
Guarantee Assets Fair Value Disclosure	4,225	3,633
Fair Value, Measurements, Recurring | Held by consolidated trusts
Liabilities [Abstract]
Debt instrument recorded at fair value	737	755
Fair Value, Measurements, Recurring | Mortgage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	20,167	16,373
Fair Value, Measurements, Recurring | Freddie Mac
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	26,119	30,199
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	12,972	13,821
Fair Value, Measurements, Recurring | Non-agency and other
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	1,388	1,658
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	3,551	5,775
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,936	3,294
Other assets:
Guarantee Assets Fair Value Disclosure	4,225	3,633
Insignificant level3 assets	182	184
Total Level3 assets fair value disclosure	10,854	12,840
Liabilities [Abstract]
Insignificant level3 liabilities	156	226
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Discounted Cash Flows
Other assets:
Guarantee Assets Fair Value Disclosure	3,970	3,391
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Other
Other assets:
Guarantee Assets Fair Value Disclosure	255	242
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Held by consolidated trusts
Liabilities [Abstract]
Debt instrument recorded at fair value	733	728
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Held by consolidated trusts | Single External Source
Liabilities [Abstract]
Debt instrument recorded at fair value	733	728
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Mortgage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,936	3,294
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Freddie Mac
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	2,150	4,097
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,930	3,286
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Freddie Mac | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value		1,259
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,047	1,587
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Freddie Mac | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	2,150	2,838
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	883	1,178
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Freddie Mac | Other
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure		521
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Non-agency and other
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	1,367	1,640
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Non-agency and other | Median of external sources
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	979	1,403
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Non-agency and other | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value		$ 237
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Non-agency and other | Other
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Available-for-sale, at fair value	$ 388
Fair Value, Measurements, Recurring | Debt | Fair Value, Inputs, Level 3 | Held by consolidated trusts | Weighted Average | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	100.4	99.6
Fair Value, Measurements, Recurring | Debt | Fair Value, Inputs, Level 3 | Held by consolidated trusts | Minimum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	99.5	97.4
Fair Value, Measurements, Recurring | Debt | Fair Value, Inputs, Level 3 | Held by consolidated trusts | Maximum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	103.9	101.1
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Freddie Mac | Weighted Average | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)		102.3
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Freddie Mac | Weighted Average | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	0.81%	0.81%
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Freddie Mac | Minimum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)		96.1
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Freddie Mac | Minimum | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	0.30%	0.30%
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Freddie Mac | Maximum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)		104.1
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Freddie Mac | Maximum | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	2.61%	3.25%
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Non-agency and other | Weighted Average | Median of external sources
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	73.5	67.3
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Non-agency and other | Weighted Average | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)		100.7
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Non-agency and other | Minimum | Median of external sources
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	70.3	64.3
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Non-agency and other | Minimum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)		93.1
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Non-agency and other | Maximum | Median of external sources
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	76.7	71.1
Fair Value, Measurements, Recurring | Available-for-sale securities | Fair Value, Inputs, Level 3 | Non-agency and other | Maximum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)		110.7
Fair Value, Measurements, Recurring | Trading securities | Fair Value, Inputs, Level 3 | Freddie Mac | Weighted Average | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	36.1	56.6
Fair Value, Measurements, Recurring | Trading securities | Fair Value, Inputs, Level 3 | Freddie Mac | Weighted Average | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	5.55%	0.90%
Fair Value, Measurements, Recurring | Trading securities | Fair Value, Inputs, Level 3 | Freddie Mac | Minimum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	0.0	0.0
Fair Value, Measurements, Recurring | Trading securities | Fair Value, Inputs, Level 3 | Freddie Mac | Minimum | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	(8.31%)	(219.45%)
Fair Value, Measurements, Recurring | Trading securities | Fair Value, Inputs, Level 3 | Freddie Mac | Maximum | Single External Source
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
External Pricing Source(s)	102.4	99.2
Fair Value, Measurements, Recurring | Trading securities | Fair Value, Inputs, Level 3 | Freddie Mac | Maximum | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	80.95%	66.39%
Fair Value, Measurements, Recurring | Guarantee Asset | Fair Value, Inputs, Level 3 | Weighted Average | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	0.43%	0.49%
Fair Value, Measurements, Recurring | Guarantee Asset | Fair Value, Inputs, Level 3 | Minimum | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	0.17%	0.17%
Fair Value, Measurements, Recurring | Guarantee Asset | Fair Value, Inputs, Level 3 | Maximum | Discounted Cash Flows
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
OAS	1.86%	1.98%

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Debt Securities and Subordinated Borrowings (Details) $ in Billions	Sep. 30, 2019 USD ($)
Debt Instrument [Line Items]
Debt cap under Purchase Agreement for the current year	$ 300.0
Aggregate indebtedness	$ 282.3

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Investments in Securities - Trading Securities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Trading Securities [Line Items]
Trading, at fair value	$ 44,449	$ 35,548
Mortage-related securities
Trading Securities [Line Items]
Trading, at fair value	20,167	16,373
Freddie Mac
Trading Securities [Line Items]
Trading, at fair value	12,972	13,821
Other agency
Trading Securities [Line Items]
Trading, at fair value	7,194	2,551
Non-agency
Trading Securities [Line Items]
Trading, at fair value	1	1
Non-mortgage-related securities
Trading Securities [Line Items]
Trading, at fair value	$ 24,282	$ 19,175

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Concentration of Credit and Other Risks - Servicer Concentration (Details)	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Single-family loan serviced | Top ten Single-family servicers
Concentration Risk [Line Items]
Concentration risk percentage	56.00%	56.00%
Single-family loan serviced | Wells Fargo Bank, N.A.
Concentration Risk [Line Items]
Concentration risk percentage	15.00%	17.00%
Single-family loan serviced | JPMorgan Chase Bank. N.A.
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	8.00%
Single-family loan serviced | Other top 10 sellers
Concentration Risk [Line Items]
Concentration risk percentage	31.00%	31.00%
Multifamily loan serviced | Top ten multifamily servicers
Concentration Risk [Line Items]
Concentration risk percentage	77.00%	75.00%
Multifamily loan serviced | Wells Fargo Bank, N.A.
Concentration Risk [Line Items]
Concentration risk percentage	15.00%	14.00%
Multifamily loan serviced | Berkadia Commercial Mortgage LLC
Concentration Risk [Line Items]
Concentration risk percentage	11.00%	11.00%
Multifamily loan serviced | CBRE Capital Markets, Inc
Concentration Risk [Line Items]
Concentration risk percentage	11.00%	14.00%
Multifamily loan serviced | Other top 10 servicers
Concentration Risk [Line Items]
Concentration risk percentage	40.00%	36.00%

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Selected Financial Statement Line Items - Significant Components of Other Assets and Other Liabilities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Other assets:
Real estate owned, net	$ 607	$ 769
Accounts and other receivables	12,816	2,447
Guarantee asset	4,225	3,633
Secured lending and other	5,439	1,805
All other	2,626	2,322
Total other assets	25,713	10,976
Other liabilities:
Guarantee obligation	4,055	3,561
All other	3,215	2,837
Total other liabilities	$ 7,270	$ 6,398

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Fair Value Disclosures Fair Value Disclosures - Changes in Fair Value under the FVO option (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Held by Freddie Mac
Fair Value, Option, Quantitative Disclosures [Line Items]
Fair Value, Option, Changes in Fair Value, Gain (Loss)	$ 49	$ 10	$ 116	$ 38
Held by consolidated trusts
Fair Value, Option, Quantitative Disclosures [Line Items]
Fair Value, Option, Changes in Fair Value, Gain (Loss)	(1)	2	(6)	4
Loans Receivable [Member]
Fair Value, Option, Quantitative Disclosures [Line Items]
Fair Value, Option, Changes in Fair Value, Gain (Loss)	398	(285)	1,216	(797)
HFS loan purchase commitments
Fair Value, Option, Quantitative Disclosures [Line Items]
Fair Value, Option, Changes in Fair Value, Gain (Loss)	$ 641	$ 267	$ 1,644	$ 564

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Guarantee Activities (Tables)

9 Months Ended

Sep. 30, 2019

Guarantees [Abstract]

Table - Financial Guarantees

The table below shows our maximum exposure, recognized liability, and maximum remaining term of our recognized guarantees to non-consolidated VIEs and other third parties. This table does not include our unrecognized guarantees, such as guarantees to consolidated VIEs or to resecuritization trusts that do not expose us to incremental credit risk. The maximum exposure disclosed in the table is not representative of the actual loss we are likely to incur, based on our historical loss experience and after consideration of proceeds from related collateral liquidation, including possible recoveries under credit enhancement arrangements.

Table 5.1 - Financial Guarantees

	September 30, 2019					December 31, 2018
(Dollars in millions, terms in years)	Maximum Exposure(1)		Recognized Liability(2)		Maximum Remaining Term	Maximum Exposure(1)		Recognized Liability(2)		Maximum Remaining Term
Single-family:
Securitization activity guarantees		$24,387		$317	40		$17,783		$220	40
Other mortgage-related guarantees	7,139		180		30	6,139		167		30
Total single-family		$31,526		$497			$23,922		$387
Multifamily:
Securitization activity guarantees		$241,853		$3,128	40		$221,245		$2,746	40
Other mortgage-related guarantees	10,122		430		35	9,779		428		35
Total multifamily		$251,975		$3,558			$231,024		$3,174
Other guarantees measured at fair value		$24,976		$183	30		$16,251		$242	30

(1) The maximum exposure represents the contractual amounts that could be lost if counterparties or borrowers defaulted, without consideration of possible recoveries under credit enhancement arrangements, such as recourse provisions, third-party insurance contracts, or from collateral held or pledged. For other guarantees measured at fair value, this amount represents the notional value if it relates to our market value guarantees or guarantees of third-party derivative instruments or the UPB if it relates to a guarantee of a mortgage-related asset. For certain of our other guarantees measured at fair value, our exposure may be unlimited. We generally reduce our exposure to these guarantees with unlimited exposure through separate contracts with third parties.

(2)

For securitization activity guarantees and other mortgage-related guarantees, this amount represents the guarantee obligation on our condensed consolidated balance sheets. This amount excludes our reserve for guarantee losses, which totaled $51 million and $52 million as of September 30, 2019 and December 31, 2018, respectively, and is included within other liabilities on our condensed consolidated balance sheets. For other guarantees measured at fair value, this amount represents the fair value of the contract.

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Selected Financial Statement Line Items

9 Months Ended

Sep. 30, 2019

Selected Financial Statement Data [Abstract]

Selected Financial Statement Line Items

Selected Financial Statement Line Items

The table below presents the significant components of other income (loss) on our condensed consolidated statements of comprehensive income (loss).

Table 18.1 - Significant Components of Other Income (Loss)

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Other income (loss):
Income on guarantee obligation		$206			$176			$593			$524
All other	(60		)	(97		)	(204		)	124
Total other income (loss)		$146			$79			$389			$648

The table below presents the significant components of other assets and other liabilities on our condensed consolidated balance sheets.

Table 18.2 - Significant Components of Other Assets and Other Liabilities

(In millions)	September 30, 2019		December 31, 2018
Other assets:
Real estate owned, net		$607		$769
Accounts and other receivables(1)	12,816		2,447
Guarantee asset	4,225		3,633
Secured lending and other	5,439		1,805
All other	2,626		2,322
Total other assets		$25,713		$10,976
Other liabilities:
Guarantee obligation		$4,055		$3,561
All other	3,215		2,837
Total other liabilities		$7,270		$6,398

(1)

Primarily consists of servicer receivables and other non-interest receivables.

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Concentration of Credit and Other Risks

9 Months Ended

Sep. 30, 2019

Risks and Uncertainties [Abstract]

CONCENTRATION OF CREDIT AND OTHER RISKS

Concentration of Credit and Other Risks

Single-Family Credit Guarantee Portfolio

The table below summarizes the concentration by loan portfolio and geographic area of the approximately $2.0 trillion and $1.9 trillion UPB of our single-family credit guarantee portfolio as of September 30, 2019 and December 31, 2018, respectively. See Note 4 and Note 7 for more information about credit risk associated with loans and mortgage-related securities that we hold or guarantee.

Table 14.1 - Concentration of Credit Risk of Our Single-Family Credit Guarantee Portfolio

	September 30, 2019				December 31, 2018				Percent of Credit Losses
	Percentage  of Portfolio		Serious Delinquency Rate		Percentage  of Portfolio		Serious Delinquency Rate		YTD 2019		YTD 2018
Core single-family loan portfolio	84	%	0.24	%	82	%	0.22	%	16	%	12	%
Legacy and relief refinance single-family loan portfolio	16		1.77		18		1.93		84		88
Total	100	%	0.61		100	%	0.69		100	%	100	%
Region(1)
West	30	%	0.35		30	%	0.38		12	%	17	%
Northeast	24		0.86		24		0.96		40		40
North Central	16		0.60		16		0.63		19		18
Southeast	16		0.72		16		0.90		22		18
Southwest	14		0.51		14		0.57		7		7
Total	100	%	0.61		100	%	0.69		100	%	100	%
State(2)
Florida	6	%	0.75		6	%	1.01		14	%	10	%
New York	5		1.20		5		1.37		12		12
New Jersey	3		1.07		3		1.24		10		10
Illinois	4		0.82		5		0.86		10		9
California	18		0.33		18		0.35		7		10
All other	64		0.57		63		0.64		47		49
Total	100	%	0.61	%	100	%	0.69	%	100	%	100	%

(1) Region designation: West (AK, AZ, CA, GU, HI, ID, MT, NV, OR, UT, WA); Northeast (CT, DE, DC, MA, ME, MD, NH, NJ, NY, PA, RI, VT, VA, WV); North Central (IL, IN, IA, MI, MN, ND, OH, SD, WI); Southeast (AL, FL, GA, KY, MS, NC, PR, SC, TN, VI); Southwest (AR, CO, KS, LA, MO, NE, NM, OK, TX, WY).

(2)

States presented based on those with the highest percentage of credit losses during YTD 2019.

Credit Performance of Certain Higher Risk Single-Family Loan Categories

Participants in the mortgage market have characterized single-family loans based upon their overall credit quality at the time of origination, including as prime or subprime. Mortgage market participants have classified single-family loans as Alt-A if these loans have credit characteristics that range between their prime and subprime categories, if they are underwritten with lower or alternative income or asset documentation requirements compared to a full documentation loan, or both. Although we discontinued new purchases of loans with lower documentation standards beginning March 1, 2009, we continued to purchase certain amounts of these loans in cases where the loan was either:

n Purchased pursuant to a previously issued other mortgage-related guarantee;

n Part of our relief refinance initiative; or

n In another refinance loan initiative and the pre-existing loan (including Alt-A loans) was originated under less than full documentation standards.

In the event we purchase a refinance loan and the original loan had been previously identified as Alt-A, such refinance loan may no longer be categorized or reported as Alt-A in the table below because the new refinance loan replacing the original loan would not be identified by the seller/servicer as an Alt-A loan. As a result, our reported Alt-A balances may be lower than would otherwise be the case had such refinancing not occurred.

Although we do not categorize single-family loans we purchase or guarantee as prime or subprime, we recognize that there are a number of loan types with certain characteristics that indicate a higher degree of credit risk.

For example, a borrower's credit score is a useful measure for assessing the credit quality of the borrower. Statistically, borrowers with higher credit scores are more likely to repay or have the ability to refinance than those with lower scores.

Presented below is a summary of the serious delinquency rates of certain higher-risk categories (based on characteristics of the loan at origination) of loans in our single-family credit guarantee portfolio. The table includes a presentation of each higher-risk category in isolation. A single loan may fall within more than one category (for example, an interest-only loan may also have an original LTV ratio greater than 90%). Loans with a combination of these attributes will have an even higher risk of delinquency than those with an individual attribute.

Table 14.2 - Certain Higher Risk Categories in Our Single-Family Credit Guarantee Portfolio

	Percentage of Portfolio(1)				Serious Delinquency Rate(1)
(Percentage of portfolio based on UPB)	September 30, 2019		December 31, 2018		September 30, 2019		December 31, 2018
Interest-only	1	%	1	%	2.72	%	3.43	%
Alt-A	1		1		3.75		4.13
Original LTV ratio greater than 90%(2)	18		18		0.92		1.04
Lower credit scores at origination (less than 620)	2		2		4.24		4.59

(1) Excludes loans underlying certain other securitization products for which data was not available.

(2)

Includes HARP loans, which we purchased as part of our participation in the MHA Program.

Sellers and Servicers

Sellers

We acquire a significant portion of our single-family and multifamily loan purchase volume from several large sellers. The tables below summarize the concentration of single-family and multifamily sellers who provided 10% or more of our purchase volume during YTD 2019 or YTD 2018.

Table 14.3 - Seller Concentration

Single-family Sellers(1)	YTD 2019		YTD 2018
JPMorgan Chase Bank, N.A.	16	%	5	%
Wells Fargo Bank, N.A.	7		12
Other top 10 sellers	33		32
Top 10 single-family sellers	56	%	49	%
Multifamily Sellers(1)	YTD 2019		YTD 2018
CBRE Capital Markets, Inc.	16	%	19	%
Berkadia Commercial Mortgage LLC	15		12
Other top 10 sellers	48		47
Top 10 multifamily sellers	79	%	78	%

(1) Sellers presented based on those with the highest percentage of purchase volume during YTD 2019.

In recent years, there has been a shift in our single-family purchase volume from depository institutions to non-depository and smaller depository financial institutions. Some of these non-depository sellers have grown in recent years, and we purchase a significant share of our loans from them. Our top five non-depository sellers provided approximately 26% and 22% of our single-family purchase volume during YTD 2019 and YTD 2018, respectively.

Servicers

Significant portions of our single-family and multifamily loans are serviced by several large servicers. The tables below summarize the concentration of single-family and multifamily servicers who serviced 10% or more of our single-family credit guarantee portfolio and our multifamily mortgage portfolio as of September 30, 2019 or December 31, 2018. For purposes of determining the concentration of servicers in the tables below, our multifamily mortgage portfolio excludes loans underlying multifamily securitizations where we are not in first loss position, primarily K Certificates and SB Certificates.

Table 14.4 - Servicer Concentration

Single-family Servicers(2)	September 30, 2019(1)		December 31, 2018(1)
Wells Fargo Bank, N.A.	15	%	17	%
JPMorgan Chase Bank, N.A.	10		8
Other top 10 servicers	31		31
Top 10 single-family servicers	56	%	56	%

Multifamily Servicers(2)	September 30, 2019		December 31, 2018
Wells Fargo Bank, N.A.	15	%	14	%
Berkadia Commercial Mortgage LLC	11		11
CBRE Capital Markets, Inc.	11		14
Other top 10 servicers	40		36
Top 10 multifamily servicers	77	%	75	%

(1) Percentage of servicing volume is based on the total single-family credit guarantee portfolio, which includes loans where we do not exercise servicing control. However, loans where we do not exercise servicing control are not included for purposes of determining the concentration of servicers who serviced more than 10% of our single-family credit guarantee portfolio because we do not know which entity serves as the primary servicer for such loans.

(2) Servicers presented based on those with the highest percentage of servicing volume as of September 30, 2019.

In recent years, there has been a shift in our single-family servicing from depository institutions to non-depository servicers. Some of these non-depository servicers have grown in recent years and now service a large share of our loans. As of September 30, 2019 and December 31, 2018, approximately 18% and 16%, respectively, of our single-family credit guarantee portfolio was serviced by our top five non-depository servicers. We actively manage the performance of our largest non-depository servicers. Additionally, as part of our efforts on home ownership retention and loss mitigation, we have been consolidating a portion of our default servicing with Freddie Mac selected specialty servicers.

Credit Enhancement Providers

We have counterparty credit risk relating to the potential insolvency of, or non-performance by, mortgage insurers that insure single-family loans we purchase or guarantee. We also have similar exposure to insurers and reinsurers through our ACIS transactions where we purchase insurance policies as part of our CRT activities.

In March 2019, we implemented a set of revised Private Mortgage Insurer Eligibility Requirements (PMIERs) with enhancements to the risk-based capital requirements for mortgage insurers. In addition, we revised master policies with mortgage insurers which provide contract certainty and improve our ability to collect claims for mortgage insurance obligations. These policies were approved by FHFA and are expected to become effective during 2020.

We evaluate the recovery and collectability from mortgage insurers as part of the estimate of our allowance for credit losses. See Note 4 for additional information. As of September 30, 2019, mortgage insurers provided coverage with maximum loss limits of $105.2 billion, for $411.0 billion of UPB, in connection with our single-family credit guarantee portfolio. These amounts are based on gross coverage without regard to netting of coverage that may exist to the extent an affected loan is covered under both primary and pool insurance.

The table below summarizes the concentration of mortgage insurer counterparties who provided 10% or more of our overall mortgage insurance coverage. On October 23, 2016, Genworth Financial, Inc. announced that it had entered into an agreement to be acquired by China Oceanwide Holdings Group Co., Ltd. Because Genworth Mortgage Insurance Corporation, a subsidiary of Genworth Financial, Inc., is an approved mortgage insurer, Freddie Mac has evaluated the planned acquisition and approved China Oceanwide Holdings Group's control of Genworth Mortgage Insurance Corporation. Regulatory and other approvals of the acquisition are still pending.

Table 14.5 - Mortgage Insurer Concentration

		Mortgage Insurance Coverage(2)
Mortgage Insurer	Credit Rating(1)	September 30, 2019		December 31, 2018
Arch Mortgage Insurance Company	A-	22	%	24	%
Radian Guaranty Inc.	BBB	20		20
Mortgage Guaranty Insurance Corporation	BBB	18		19
Genworth Mortgage Insurance Corporation	BB+	15		14
Essent Guaranty, Inc.	BBB+	15		14
Total		90	%	91	%

(1) Ratings are for the corporate entity to which we have the greatest exposure. Latest rating available as of September 30, 2019. Represents the lower of S&P and Moody’s credit ratings stated in terms of the S&P equivalent.

(2) Includes primary mortgage insurance and pool insurance. Coverage amounts may include coverage provided by affiliates and subsidiaries of the counterparty.

We received proceeds of $0.1 billion and $0.2 billion during YTD 2019 and YTD 2018, respectively, from our primary and pool mortgage insurance policies for recovery of losses on our single-family loans. We had outstanding receivables from mortgage insurers of $0.1 billion (excluding deferred payment obligations associated with unpaid claim amounts) as of both September 30, 2019 and December 31, 2018. The balance of these receivables, net of associated reserves, was approximately $0.1 billion at both September 30, 2019 and December 31, 2018.

PMI Mortgage Insurance Co. and Triad Guaranty Insurance Corp. are both under the control of their state regulators and are in run-off. A substantial portion of their claims is recorded by us as deferred payment obligations. As of both September 30, 2019 and December 31, 2018, we had cumulative unpaid deferred payment obligations of $0.5 billion from these insurers. We have reserved substantially all of these unpaid amounts as collectability is uncertain. It is not clear how the regulators of these companies will administer their respective deferred payment plans in the future, nor when or if those obligations will be paid.

As part of our ACIS and other CRT transactions, we regularly obtain insurance coverage from insurers and reinsurers. These transactions incorporate several features designed to increase the likelihood that we will recover on the claims we file with the insurers and reinsurers, including the following:

n In each transaction, we require the individual insurers and reinsurers to post collateral to cover portions of their exposure, which helps to promote certainty and timeliness of claim payment and

n While private mortgage insurance companies are required to be monoline (i.e., to participate solely in the mortgage insurance business, although the holding company may be a diversified insurer), many of our insurers and reinsurers in these transactions participate in multiple types of insurance business, which helps diversify their risk exposure.

Other Investments Counterparties

We are exposed to the non-performance of counterparties relating to other investments (including non-mortgage-related securities and cash equivalents) transactions, including those entered into on behalf of our securitization trusts. Our policies require that the counterparty be evaluated using our internal counterparty rating model prior to our entering into such transactions. We monitor the financial strength of our counterparties to these transactions and may use collateral maintenance requirements to manage our exposure to individual counterparties. The permitted term and dollar limits for each of these transactions are also based on the counterparty's financial strength.

Our other investments (including non-mortgage-related securities and cash equivalents) counterparties are primarily major financial institutions, including other GSEs, Treasury, the Federal Reserve Bank of New York, GSD/FICC, highly-rated supranational institutions, depository and non-depository institutions, brokers and dealers, and government money market funds. As of September 30, 2019 and December 31, 2018, including amounts related to our consolidated VIEs, the balance in our other investments was $89.6 billion and $63.1 billion, respectively. The balances consist primarily of cash and securities purchased under agreements to resell invested with counterparties, U.S. Treasury securities, cash deposited with the Federal Reserve Bank of New York, and secured lending activities. As of September 30, 2019, all of our securities purchased under agreements to resell were fully collateralized. As of September 30, 2019 and December 31, 2018, $2.2 billion and $2.5 billion of our securities purchased under agreements to resell were used to provide financing to investors in Freddie Mac securities to increase liquidity and expand the investor base for those securities. These transactions differ from the securities purchased under agreements to resell that we use for liquidity purposes as the counterparties we face may not be major financial institutions and we are exposed to the counterparty risk of these institutions.

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Mortgage Loans and Loan Loss Reserves - Recorded Investment of Held-for-Investment Loans by Payment Status (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Financing Receivable, Past Due [Line Items]
Current	$ 1,934,103	$ 1,862,429
Total recorded investment	1,961,226	1,891,495
Non-Accrual	6,456	8,138
Mortgage Loans in Process of Foreclosure, Amount	1,900	2,900
Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Current	1,624,964	1,532,499
Total recorded investment	1,648,880	1,557,667
Non-Accrual	5,573	6,881
Single-family 15-year amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Current	239,460	254,376
Total recorded investment	240,892	255,831
Non-Accrual	237	263
Single-family Adjustable-rate
Financing Receivable, Past Due [Line Items]
Current	38,928	43,549
Total recorded investment	39,325	44,007
Non-Accrual	95	113
Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Past Due [Line Items]
Current	13,855	16,975
Total recorded investment	15,230	18,960
Non-Accrual	538	864
Single-family
Financing Receivable, Past Due [Line Items]
Current	1,917,207	1,847,399
Total recorded investment	1,944,327	1,876,465
Non-Accrual	6,443	8,121
Multifamily
Financing Receivable, Past Due [Line Items]
Current	16,896	15,030
Total recorded investment	16,899	15,030
Non-Accrual	13	17
One month past due
Financing Receivable, Past Due [Line Items]
Past Due	16,731	16,784
One month past due | Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Past Due	14,846	14,683
One month past due | Single-family 15-year amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Past Due	1,025	1,021
One month past due | Single-family Adjustable-rate
Financing Receivable, Past Due [Line Items]
Past Due	249	287
One month past due | Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Past Due [Line Items]
Past Due	608	793
One month past due | Single-family
Financing Receivable, Past Due [Line Items]
Past Due	16,728	16,784
One month past due | Multifamily
Financing Receivable, Past Due [Line Items]
Past Due	3	0
Two months past due
Financing Receivable, Past Due [Line Items]
Past Due	3,946	4,158
Two months past due | Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Past Due	3,495	3,602
Two months past due | Single-family 15-year amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Past Due	170	171
Two months past due | Single-family Adjustable-rate
Financing Receivable, Past Due [Line Items]
Past Due	53	58
Two months past due | Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Past Due [Line Items]
Past Due	228	327
Two months past due | Single-family
Financing Receivable, Past Due [Line Items]
Past Due	3,946	4,158
Two months past due | Multifamily
Financing Receivable, Past Due [Line Items]
Past Due	0	0
Three months or more past due or in foreclosure
Financing Receivable, Past Due [Line Items]
Past Due	6,446	8,124
Three months or more past due or in foreclosure | Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Past Due	5,575	6,883
Three months or more past due or in foreclosure | Single-family 15-year amortizing fixed-rate
Financing Receivable, Past Due [Line Items]
Past Due	237	263
Three months or more past due or in foreclosure | Single-family Adjustable-rate
Financing Receivable, Past Due [Line Items]
Past Due	95	113
Three months or more past due or in foreclosure | Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Past Due [Line Items]
Past Due	539	865
Three months or more past due or in foreclosure | Single-family
Financing Receivable, Past Due [Line Items]
Past Due	6,446	8,124
Three months or more past due or in foreclosure | Multifamily
Financing Receivable, Past Due [Line Items]
Past Due	$ 0	$ 0

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Conservatorship and Related Matters (Details) - USD ($)	3 Months Ended		9 Months Ended		60 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Dec. 31, 2019	Dec. 31, 2018
Related Party Transaction [Line Items]
Applicable capital reserve amount from July 1, 2019 and thereafter	$ 20,000,000,000.0		$ 20,000,000,000.0		$ 20,000,000,000.0
Preference liquidation maximum increase	17,000,000,000.0		17,000,000,000.0		17,000,000,000.0
Senior preferred stock, at redemption value	77,474,000,000	$ 75,600,000,000	77,474,000,000		77,474,000,000		$ 75,648,000,000
Net worth increase	1,800,000,000	$ 1,800,000,000
Maximum limit of the UPB of mortgage-related investments portfolio	225,000,000,000		225,000,000,000		225,000,000,000
UPB of mortgage-related investments portfolio	221,600,000,000		221,600,000,000		221,600,000,000
Increase in liquidation preference	0		0	$ 312,000,000
Funding available under Purchase Agreement	$ 140,200,000,000		140,200,000,000		140,200,000,000
CSS
Related Party Transaction [Line Items]
Amount of related party transaction			$ 84,000,000		$ 548,000,000
Subsequent Event [Member]
Related Party Transaction [Line Items]
Senior preferred stock, at redemption value						$ 79,300,000,000

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Mortgage Loans and Loan Loss Reserves - Mortgage Loans (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	$ 42,646	$ 44,905
Cost basis and fair value adjustments, net HFS	(1,528)	(3,283)
Total held-for-sale loans, net	41,118	41,622
UPB of mortgage loans - HFI	1,926,674	1,864,941
Cost basis adjustment HFI	34,552	26,554
Allowance for loan losses on mortgage loans held-for-investment	(4,854)	(6,139)
Total held-for-investment mortgage loans, net	1,956,372	1,885,356
Total mortgage loans, net	1,997,490	1,926,978
Single-family
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	17,249	20,946
UPB of mortgage loans - HFI	1,909,792	1,849,893
Allowance for loan losses on mortgage loans held-for-investment	(4,841)	(6,130)
Total held-for-investment mortgage loans, net	1,939,486	1,870,335
Multifamily
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	25,397	23,959
UPB of mortgage loans - HFI	16,882	15,048
Allowance for loan losses on mortgage loans held-for-investment	(13)	(9)
Total held-for-investment mortgage loans, net	16,886	15,021
Held by Freddie Mac
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	42,646	44,905
Cost basis and fair value adjustments, net HFS	(1,528)	(3,283)
Total held-for-sale loans, net	41,118	41,622
UPB of mortgage loans - HFI	53,177	46,713
Cost basis adjustment HFI	(421)	(1,198)
Allowance for loan losses on mortgage loans held-for-investment	(2,017)	(3,009)
Total held-for-investment mortgage loans, net	50,739	42,506
Total mortgage loans, net	91,857	84,128
Held by Freddie Mac | Single-family
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	17,249	20,946
UPB of mortgage loans - HFI	41,886	35,885
Held by Freddie Mac | Multifamily
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	25,397	23,959
UPB of mortgage loans - HFI	11,291	10,828
Held by consolidated trusts
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	0	0
Cost basis and fair value adjustments, net HFS	0	0
Total held-for-sale loans, net	0	0
UPB of mortgage loans - HFI	1,873,497	1,818,228
Cost basis adjustment HFI	34,973	27,752
Allowance for loan losses on mortgage loans held-for-investment	(2,837)	(3,130)
Total held-for-investment mortgage loans, net	1,905,633	1,842,850
Total mortgage loans, net	1,905,633	1,842,850
Held by consolidated trusts | Single-family
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	0	0
UPB of mortgage loans - HFI	1,867,906	1,814,008
Held by consolidated trusts | Multifamily
Accounts, Notes, Loans and Financing Receivables [Line Items]
UPB of mortgage loans - HFS	0	0
UPB of mortgage loans - HFI	$ 5,591	$ 4,220

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Fair Value Disclosures - Assets Measured at Fair Value on a Non-Recurring Basis (Details) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Assets, Fair Value Disclosure [Abstract]
Mortgage loans	$ 3,730	$ 7,543
Level 1
Assets, Fair Value Disclosure [Abstract]
Mortgage loans	0	0
Level 2
Assets, Fair Value Disclosure [Abstract]
Mortgage loans	429	24
Level 3
Assets, Fair Value Disclosure [Abstract]
Mortgage loans	$ 3,301	$ 7,519

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Debt Securities and Subordinated Borrowings - Total Debt, Net (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Debt Net [Abstract]
Total Debt, Net	$ 2,149,259		$ 2,149,259		$ 2,044,950
Interest Expense [Abstract]
Interest Expense, Total	15,130	$ 14,546	46,498	$ 42,802
Held by consolidated trusts
Debt Net [Abstract]
Total Debt, Net	1,869,308		1,869,308		1,792,677
Interest Expense [Abstract]
Interest Expense, Total	13,324	12,827	41,001	37,996
Held by Freddie Mac
Debt Net [Abstract]
Short-term Debt Balance Net	94,344		94,344		51,080
Long-term Debt Balance, Net	185,607		185,607		201,193
Total Debt, Net	279,951		279,951		$ 252,273
Interest Expense [Abstract]
Interest Expense, Short-term Borrowings	499	361	1,419	832
Interest Expense, Long-term Debt	1,307	1,358	4,078	3,974
Interest Expense, Total	$ 1,806	$ 1,719	$ 5,497	$ 4,806

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Investments in Securities - Available-For-Sale Securities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 27,575	$ 33,460
Gross Unrealized Gains	1,043	640
Available-for-sale, at fair value	28,533	33,563
Freddie Mac
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	25,492	30,407
Gross Unrealized Gains	707	320
Available-for-sale, at fair value	26,119	30,199
Other agency
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	1,005	1,675
Gross Unrealized Gains	26	38
Available-for-sale, at fair value	1,026	1,706
Non-agency and other
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	1,078	1,378
Gross Unrealized Gains	310	282
Available-for-sale, at fair value	1,388	1,658
Other-than-temporary impairment
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	0	0
Other-than-temporary impairment | Freddie Mac
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	0	0
Other-than-temporary impairment | Other agency
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	0	0
Other-than-temporary impairment | Non-agency and other
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	0	0
Temporary impairment
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	(85)	(537)
Temporary impairment | Freddie Mac
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	(80)	(528)
Temporary impairment | Other agency
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	(5)	(7)
Temporary impairment | Non-agency and other
Debt Securities, Available-for-sale [Line Items]
Gross Unrealized Losses	$ 0	$ (2)

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Concentration of Credit and Other Risks - Mortgage Insurer Concentration (Details) - Mortgage insurance coverage	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Arch Mortgage Insurance Company
Concentration Risk [Line Items]
Concentration risk percentage	22.00%	24.00%
Radian Guaranty Inc.
Concentration Risk [Line Items]
Concentration risk percentage	20.00%	20.00%
Mortgage Guaranty Insurance Corporation
Concentration Risk [Line Items]
Concentration risk percentage	18.00%	19.00%
Genworth Mortgage Insurance Corporation
Concentration Risk [Line Items]
Concentration risk percentage	15.00%	14.00%
Essent Guaranty, Inc.
Concentration Risk [Line Items]
Concentration risk percentage	15.00%	14.00%
Total
Concentration Risk [Line Items]
Concentration risk percentage	90.00%	91.00%

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Selected Financial Statement Line Items - Significant Components of Other Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Other income (loss):
Income on guarantee obligation	$ 206	$ 176	$ 593	$ 524
All other	(60)	(97)	(204)	124
Other income (loss)	$ 146	$ 79	$ 389	$ 648

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Fair Value Disclosures - Difference between Fair Value and UPB for Certain Financial Instruments with Fair Value Option Elected (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Fair Value, Option, Quantitative Disclosures [Line Items]
Loans Held For Sale, Fair Value	$ 21,538	$ 23,106
Loans Held For Sale, Unpaid Principal Balance, With Fair Value Option Elected	20,152	22,693
Fair Value, Option, Aggregate Differences, Loans and Long-term Receivables	1,386	413
NonDerivativeHFSPurchaseCommitmentnet	222	142
Held by Freddie Mac
Fair Value, Option, Quantitative Disclosures [Line Items]
Long-Term Debt, Fair Value	3,806	4,357
Long-Term Debt, Unpaid Principal Balance, with Fair Value Option Elected	3,538	3,998
Fair Value, Option, Aggregate Differences, Long-term Debt Instruments	268	359
Interest-Only
Fair Value, Option, Quantitative Disclosures [Line Items]
Long-Term Debt, Fair Value	61	26
Held by consolidated trusts
Fair Value, Option, Quantitative Disclosures [Line Items]
Long-Term Debt, Fair Value	733	728
Long-Term Debt, Unpaid Principal Balance, with Fair Value Option Elected	730	730
Fair Value, Option, Aggregate Differences, Long-term Debt Instruments	$ 3	$ (2)

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and include our accounts as well as the accounts of other entities in which we have a controlling financial interest. All intercompany balances and transactions have been eliminated.

We are operating under the basis that we will realize assets and satisfy liabilities in the normal course of business as a going concern and in accordance with the authority provided by FHFA to our Board of Directors to oversee management's conduct of our business operations. Certain amounts in prior periods' condensed consolidated financial statements have been reclassified to conform to the current presentation. In the opinion of management, our unaudited condensed consolidated financial statements contain all adjustments, which include only normal recurring adjustments, necessary for a fair statement of our results.

We evaluate the materiality of identified errors in the financial statements using both an income statement, or "rollover," and a balance sheet, or "iron curtain," approach, based on relevant quantitative and qualitative factors. Net income includes certain adjustments to correct immaterial errors related to previously reported periods.

Use of Estimates

Use of Estimates

The preparation of financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, gains, and losses during the reporting period. Management has made significant estimates in preparing the financial statements for establishing the allowance for credit losses and valuing financial instruments and other assets and liabilities. Actual results could be different from these estimates.

Recently Adopted or Issued Accounting Guidance

Recently Issued Accounting Guidance

Recently Adopted Accounting Guidance
Standard	Description	Date of Adoption	Effect on Condensed Consolidated Financial Statements
ASU 2016-02, Leases (Topic 842)	The amendment in this Update addresses the accounting for lease arrangements.	January 1, 2019	The adoption of the amendment did not have a material effect on our condensed consolidated financial statements or on our disclosures.
ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes	The amendments in this Update permit the OIS rate based on SOFR, as an eligible U.S. benchmark interest rate for purposes of applying hedge accounting under Topic 815.	January 1, 2019	The adoption of the amendment did not have a material effect on our condensed consolidated financial statements or on our disclosures.
ASU 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors	The amendments in this Update address certain ASU 2016-02 implementation issues including the recognition of taxes collected from lessees, lessor costs paid directly by a lessee, and recognition of variable payments for contracts with lease and non-lease components.	January 1, 2019	The adoption of the amendments did not have a material effect on our condensed consolidated financial statements or on our disclosures.

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Condensed Consolidated Financial Statements
Standard	Description	Date of Planned Adoption	Effect on Consolidated Financial Statements
ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this Update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects lifetime expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.	January 1, 2020	We have developed our models to estimate lifetime expected credit losses on our financial instruments measured at amortized cost primarily using a discounted cash flow methodology. We are using these models to execute our process for estimating the allowance for credit losses under the new standard in parallel with our existing process for estimating the allowance for credit losses under current GAAP and are developing an appropriate governance process for our estimate of expected credit losses under the new standard. The amendments will be applied through a cumulative effect adjustment to retained earnings as of the beginning of the year of adoption. While we continue to evaluate the effect that ASU 2016-13, Financial Instruments - Credit Losses, and related amendments will have on our consolidated financial statements, we expect the transition impact to result in an immaterial change in retained earnings. The increase in the allowance for credit losses from incorporating lifetime losses is generally offset by recoveries and a positive impact from including forecasts of economic conditions. The actual impact at adoption will depend upon the nature and characteristics of the portfolio at the adoption date, as well as macroeconomic conditions and forecasts at that time.
ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement	The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurements, based on the concepts in the Concepts Statement, including the consideration of costs and benefits. Certain disclosure requirements were either removed, modified, or added.	January 1, 2020	On October 1, 2018, we early adopted the amendments to remove or modify certain disclosures, which did not have a material effect on our consolidated financial statements. We are delaying adoption of the amendments to add certain disclosures until their effective date. We do not expect that the adoption of the additional disclosures will have a material effect on our consolidated financial statements.
ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract	The amendments in this Update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.
ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities	The amendments in this Update require that indirect interests held through related parties under common control be considered on a proportional basis when determining whether fees paid to decision makers or service providers are variable interests. These amendments align with the determination of whether a reporting entity within a related party group is the primary beneficiary of a VIE.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Condensed Consolidated Financial Statements
Standard	Description	Date of Planned Adoption	Effect on Consolidated Financial Statements
ASU 2019-01, Leases (Topic 842): Narrow-Scope Improvements for Lessors	The amendments in this Update provide guidance for the: (1) lessor's fair value determination of the lease's underlying asset; (2) lessor's statement of cash flows presentation of cash received from sales-type and direct financing leases; and (3) removal of interim transition disclosure requirements related to changes in accounting principles.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.
ASU 2019-04, Codification Improvements to Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Financial Instruments (Topic 825)	The amendments in this Update clarify certain aspects of Topic 326 guidance issued in ASU 2016-13 including the scope of the credit losses standard and issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayments. The other amendments in this update clarify certain aspects of Topic 815 and Topic 825.	January 1, 2020	We are assessing the impact of adopting the Topic 326 amendments as part of our assessment of the adoption impact of ASU 2016-13, Financial Instruments-Credit Losses.  We do not expect that the adoption of the Topic 815 and Topic 825 amendments will have a material effect on our consolidated financial statements.
ASU 2019-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this Update provides entities with transition relief upon the adoption of ASU 2016-13 by providing an option to elect fair value option on certain financial instruments measured at amortized cost.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

Consolidation, Variable Interest Entity, Policy

Securitization Activities and Consolidation

Our primary business activities in our Single-family Guarantee and Multifamily segments involve the securitization of loans or other mortgage-related assets using trusts that are VIEs. These trusts issue beneficial interests in the loans or other mortgage-related assets that they own. We guarantee the principal and interest payments on some or all of the issued beneficial interests in substantially all of our securitization transactions. We consolidate VIEs when we have a controlling financial interest in the VIE and are therefore considered the primary beneficiary of the VIE.

Guarantees, Indemnifications and Warranties Policies

We generate revenue through our guarantee activities by agreeing to absorb the credit risk associated with certain financial instruments that are owned or held by third parties. In exchange for providing this guarantee, we receive an ongoing guarantee fee that is commensurate with the risks assumed and that will, over the long-term, provide us with cash flows that are expected to exceed the credit-related and administrative expenses of the underlying financial instruments. The profitability of our guarantee activities may vary and will be dependent on our guarantee fee and the actual credit performance of the underlying financial instruments that we have guaranteed.

Derivatives, Methods of Accounting, Hedging Derivatives

Fair Value Hedges

We apply fair value hedge accounting to certain single-family mortgage loans and certain issuances of debt where we hedge the changes in fair value of these items attributable to the designated benchmark interest rate (i.e., LIBOR), using LIBOR-based interest-rate swaps. Beginning in September 2019, we implemented a new fair value hedge accounting strategy for single-family mortgage loans that applies certain hedge accounting elections, including the last-of-layer method, allowable under amended hedge accounting guidance we adopted during 4Q 2017. Under the last-of-layer method, we hedge the changes in fair value of a portion of a closed pool of single-family mortgage loans that is not expected to be affected by prepayments, defaults, and other events affecting the timing and amount of cash flows. As part of this new strategy, we have also elected to measure the change in fair value of the hedged item on the basis of the benchmark rate component of the contractual coupon cash flows determined at the hedge inception and by assuming the hedged item has a term that reflects only the designated cash flows being hedged.

If a hedge relationship qualifies for fair value hedge accounting, all changes in fair value of the derivative hedging instrument, including interest accruals, are recognized in the same condensed consolidated statements of comprehensive income line item used to present the earnings effect of the hedged item. Therefore, changes in the fair value of the hedged item, mortgage loans and debt, attributable to the risk being hedged are recognized in interest income - mortgage loans and interest expense, respectively, along with the changes in the fair value of the respective derivative hedging instruments.

Cash Flow Hedges

There are amounts recorded in AOCI related to discontinued cash flow hedges which are recognized in earnings when the originally forecasted transactions affect earnings. Amounts reclassified from AOCI are recorded in interest expense.

Repurchase and Resale Agreements Policy

Securities Purchased Under Agreements to Resell

As an investor, we enter into arrangements to purchase securities under agreements to subsequently resell the identical or substantially the same securities to our counterparty. Our counterparties to these transactions are required to pledge the purchased securities as collateral for their obligation to repurchase those securities at a later date. While such transactions involve the legal transfer of securities, they are accounted for as secured financings because the transferor does not relinquish effective control over the securities transferred. These agreements may allow us to repledge all or a portion of the collateral pledged to us, and we may repledge such collateral periodically, although it is not typically our practice to repledge collateral that has been pledged to us.

We consider the types of securities being pledged to us as collateral when determining how much we lend in transactions involving securities purchased under agreements to resell. Additionally, we regularly review the market values of these securities compared to amounts loaned in an effort to manage our exposure to losses.

Securities Sold Under Agreements to Repurchase

Securities sold under agreements to repurchase are effectively collateralized borrowings where we sell securities with an agreement to repurchase such securities at a future date. We are required to pledge the sold securities to the counterparties to these transactions as collateral for our obligation to repurchase these securities at a later date. Similar to the securities purchased under agreements to resell transactions, these transactions involve the legal transfer of securities. However, they are

accounted for as secured financings because they require the identical or substantially the same securities to be subsequently repurchased. These agreements may allow our counterparties to repledge all or a portion of the collateral.

Stockholders' Equity, Policy

The previously deferred amount related to closed cash flow hedges remains in our AOCI balance and will be recognized into earnings over the expected time period for which the forecasted transactions affect earnings, unless it is deemed probable that the forecasted transactions will not occur. Over the next 12 months, we estimate that approximately $49 million, net of taxes, of the $0.3 billion of cash flow hedge losses in AOCI at September 30, 2019 will be reclassified into earnings. The maximum remaining length of time over which we have hedged the exposure related to the variability in future cash flows on forecasted transactions, primarily forecasted debt issuances, is 14 years.

Earnings Per Common Share

Earnings Per Share

We have participating securities related to restricted stock units with dividend equivalent rights that receive dividends as declared on an equal basis with common shares but are not obligated to participate in undistributed net losses. These participating securities consist of vested RSUs that earn dividend equivalents at the same rate when and as declared on common stock.

Consequently, in accordance with accounting guidance, we use the "two-class" method of computing earnings per common share. The "two-class" method is an earnings allocation formula that determines earnings per share for common stock and participating securities based on dividends declared and participation rights in undistributed earnings.

Basic earnings per common share is computed as net income attributable to common stockholders divided by the weighted average common shares outstanding for the period. The weighted average common shares outstanding for the period includes the weighted average number of shares that are associated with the warrant for our common stock issued to Treasury pursuant to the Purchase Agreement. These shares are included since the warrant is unconditionally exercisable by the holder at a minimal cost.

Diluted earnings per common share is computed as net income attributable to common stockholders divided by the weighted average common shares outstanding during the period adjusted for the dilutive effect of common equivalent shares outstanding. For periods with net income attributable to common stockholders, the calculation includes the effect of the weighted-average of RSUs.

During periods in which a net loss attributable to common stockholders has been incurred, potential common equivalent shares outstanding are not included in the calculation because it would have an antidilutive effect.

Fair Value of Financial Instruments

The accounting guidance for fair value measurements and disclosures defines fair value, establishes a framework for measuring fair value, and sets forth disclosure requirements regarding fair value measurements. This guidance applies whenever other accounting guidance requires or permits assets or liabilities to be measured at fair value. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurement assumes that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or, in the absence of a principal market, in the most advantageous market for the asset or liability.

We use fair value measurements for the initial recording of certain assets and liabilities and periodic remeasurement of certain assets and liabilities on a recurring or non-recurring basis.

Fair Value Measurements

The accounting guidance for fair value measurements and disclosures establishes a three-level fair value hierarchy that prioritizes the inputs into the valuation techniques used to measure fair value. The levels of the fair value hierarchy are defined as follows in priority order:

n Level 1 - inputs to the valuation techniques are based on quoted prices in active markets for identical assets or liabilities.

n Level 2 - inputs to the valuation techniques are based on observable inputs other than quoted prices in active markets for identical assets or liabilities.

n Level 3 - one or more inputs to the valuation technique are unobservable and significant to the fair value measurement.

We use quoted market prices and valuation techniques that seek to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs. Our inputs are based on the assumptions a market participant would use in valuing the asset or liability. Assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.

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Fair Value Disclosures

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

FAIR VALUE DISCLOSURES

Fair Value Disclosures

The accounting guidance for fair value measurements and disclosures defines fair value, establishes a framework for measuring fair value, and sets forth disclosure requirements regarding fair value measurements. This guidance applies whenever other accounting guidance requires or permits assets or liabilities to be measured at fair value. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurement assumes that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or, in the absence of a principal market, in the most advantageous market for the asset or liability.

We use fair value measurements for the initial recording of certain assets and liabilities and periodic remeasurement of certain assets and liabilities on a recurring or non-recurring basis.

Fair Value Measurements

The accounting guidance for fair value measurements and disclosures establishes a three-level fair value hierarchy that prioritizes the inputs into the valuation techniques used to measure fair value. The levels of the fair value hierarchy are defined as follows in priority order:

n Level 1 - inputs to the valuation techniques are based on quoted prices in active markets for identical assets or liabilities.

n Level 2 - inputs to the valuation techniques are based on observable inputs other than quoted prices in active markets for identical assets or liabilities.

n Level 3 - one or more inputs to the valuation technique are unobservable and significant to the fair value measurement.

We use quoted market prices and valuation techniques that seek to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs. Our inputs are based on the assumptions a market participant would use in valuing the asset or liability. Assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The tables below present our assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis subsequent to initial recognition, including instruments where we have elected the fair value option.

Table 15.1 - Assets and Liabilities Measured at Fair Value on a Recurring Basis

	September 30, 2019
(In millions)	Level 1		Level 2		Level 3		Netting Adjustment(1)			Total
Assets:
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$—		$23,969		$2,150		$—			$26,119
Other agency	—		992		34		—			1,026
Non-agency and other	—		21		1,367		—			1,388
Total available-for-sale securities, at fair value	—		24,982		3,551		—			28,533
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	—		10,042		2,930		—			12,972
Other agency	—		7,189		5		—			7,194
All other	—		—		1		—			1
Total mortgage-related securities	—		17,231		2,936		—			20,167
Non-mortgage-related securities	21,952		2,330		—		—			24,282
Total trading securities, at fair value	21,952		19,561		2,936		—			44,449
Total investments in securities	21,952		44,543		6,487		—			72,982
Mortgage loans:
Held-for-sale, at fair value	—		21,538		—		—			21,538
Derivative assets, net:
Interest-rate swaps	—		2,504		—		—			2,504
Option-based derivatives	—		5,196		—		—			5,196
Other	—		192		16		—			208
Subtotal, before netting adjustments	—		7,892		16		—			7,908
Netting adjustments(1)	—		—		—		(6,316		)	(6,316		)
Total derivative assets, net	—		7,892		16		(6,316		)	1,592
Other assets:
Guarantee asset, at fair value	—		—		4,225		—			4,225
Non-derivative held-for-sale purchase commitments, at fair value	—		223		—		—			223
All other, at fair value	—		—		142		—			142
Total other assets	—		223		4,367		—			4,590
Total assets carried at fair value on a recurring basis		$21,952		$74,196		$10,870		($6,316	)		$100,702
Liabilities:
Debt securities of consolidated trusts held by third parties, at fair value		$—		$4		$733		$—			$737
Other debt, at fair value	—		3,733		130		—			3,863
Derivative liabilities, net:
Interest-rate swaps	—		6,102		—		—			6,102
Option-based derivatives	—		78		—		—			78
Other	—		257		40		—			297
Subtotal, before netting adjustments	—		6,437		40		—			6,477
Netting adjustments(1)	—		—		—		(6,122		)	(6,122		)
Total derivative liabilities, net	—		6,437		40		(6,122		)	355
Other liabilities:
Non-derivative held-for-sale purchase commitments, at fair value	—		1		—		—			1
All other, at fair value	—		—		2		—			2
Total liabilities carried at fair value on a recurring basis		$—		$10,175		$905		($6,122	)		$4,958

Referenced footnote is included after the next table.

	December 31, 2018
(In millions)	Level 1		Level 2		Level 3		Netting Adjustment(1)			Total
Assets:
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$—		$26,102		$4,097		$—			$30,199
Other agency	—		1,668		38		—			1,706
Non-agency and other	—		18		1,640		—			1,658
Total available-for-sale securities, at fair value	—		27,788		5,775		—			33,563
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	—		10,535		3,286		—			13,821
Other agency	—		2,544		7		—			2,551
All other	—		—		1		—			1
Total mortgage-related securities	—		13,079		3,294		—			16,373
Non-mortgage-related securities	15,885		3,290		—		—			19,175
Total trading securities, at fair value	15,885		16,369		3,294		—			35,548
Total investments in securities	15,885		44,157		9,069		—			69,111
Mortgage loans:
Held-for-sale, at fair value	—		23,106		—		—			23,106
Derivative assets, net:
Interest-rate swaps	—		2,127		—		—			2,127
Option-based derivatives	—		4,200		—		—			4,200
Other	—		90		1		—			91
Subtotal, before netting adjustments	—		6,417		1		—			6,418
Netting adjustments(1)	—		—		—		(6,083		)	(6,083		)
Total derivative assets, net	—		6,417		1		(6,083		)	335
Other assets:
Guarantee asset, at fair value	—		—		3,633		—			3,633
Non-derivative held-for-sale purchase commitments, at fair value	—		159		—		—			159
All other, at fair value	—		—		137		—			137
Total other assets	—		159		3,770		—			3,929
Total assets carried at fair value on a recurring basis		$15,885		$73,839		$12,840		($6,083	)		$96,481
Liabilities:
Debt securities of consolidated trusts held by third parties, at fair value		$—		$27		$728		$—			$755
Other debt, at fair value	—		4,223		134		—			4,357
Derivative liabilities, net:
Interest-rate swaps	—		3,974		—		—			3,974
Option-based derivatives	—		137		—		—			137
Other	—		225		92		—			317
Subtotal, before netting adjustments	—		4,336		92		—			4,428
Netting adjustments(1)	—		—		—		(3,845		)	(3,845		)
Total derivative liabilities, net	—		4,336		92		(3,845		)	583
Other liabilities:
Non-derivative held-for-sale purchase commitments, at fair value	—		17		—		—			17
Total liabilities carried at fair value on a recurring basis		$—		$8,603		$954		($3,845	)		$5,712

(1)

Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

Level 3 Fair Value Measurements

The tables below present a reconciliation of all assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis using significant unobservable inputs (Level 3), including transfers into and out of Level 3. The tables also present gains and losses due to changes in fair value, including both realized and unrealized gains and losses, recognized on our condensed consolidated statements of comprehensive income for Level 3 assets and liabilities.

Table 15.2 - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs

	3Q 2019
	Balance, July 1, 2019		Realized and unrealized gains (losses)									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$2,744		$23			$16			$39			$—		$—		($531	)		($102	)		$—		$—			$2,150		$1
Other agency	36		—			—			—			—		—		—			(2		)	—		—			34		—
Non-agency and other	1,494		26			(10		)	16			—		—		(87		)	(56		)	—		—			1,367		3
Total available-for-sale mortgage-related securities	4,274		49			6			55			—		—		(618		)	(160		)	—		—			3,551		4
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,028		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,930		(31		)
Other agency	5		—			—			—			—		—		—			—			—		—			5		—
All other	1		—			—			—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,034		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,936		(31		)
Other assets:
Guarantee asset	3,941		15			—			15			—		439		—			(170		)	—		—			4,225		15
All other, at fair value	126		12			—			12			24		12		(27		)	(5		)	—		—			142		(3		)
Total other assets		$4,067		$27			$—			$27			$24		$451		($27	)		($175	)		$—		$—			$4,367		$12
	Balance, July 1, 2019		Realized and unrealized (gains) losses									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733		$—			$—			$—			$—		$—		$—			$—			$—		$—			$733		$—
Other debt, at fair value	129		—			—			—			2		—		—			(1		)	—		—			130		—
Net derivatives(2)	40		(8		)	—			(8		)	—		—		—			(8		)	—		—			24		(13		)
All other, at fair value	—		2			—			2			2		—		(2		)	—			—		—			2		—

Referenced footnotes are included after the prior period tables.

	YTD 2019
	Balance, January 1, 2019		Realized and unrealized gains (losses)								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income		Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$4,097		$13			$115		$128			$202		$—		($1,724	)		($290	)		$—		($263	)		$2,150		$2
Other agency	38		—			1		1			—		—		—			(5		)	—		—			34		—
Non-agency and other	1,640		52			25		77			—		—		(174		)	(176		)	—		—			1,367		12
Total available-for-sale mortgage-related securities	5,775		65			141		206			202		—		(1,898		)	(471		)	—		(263		)	3,551		14
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,286		(113		)	—		(113		)	1,242		—		(730		)	95			8		(858		)	2,930		(68		)
Other agency	7		—			—		—			—		—		(2		)	—			—		—			5		(1		)
All other	1		—			—		—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,294		(113		)	—		(113		)	1,242		—		(732		)	95			8		(858		)	2,936		(69		)
Other assets:
Guarantee asset	3,633		75			—		75			—		1,005		—			(488		)	—		—			4,225		75
All other, at fair value	137		(31		)	—		(31		)	75		29		(59		)	(9		)	—		—			142		(51		)
Total other assets		$3,770		$44			$—		$44			$75		$1,034		($59	)		($497	)		$—		$—			$4,367		$24
	Balance, January 1, 2019		Realized and unrealized (gains) losses								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income		Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728		$5			$—		$5			$—		$—		$—			$—			$—		$—			$733		$5
Other debt, at fair value	134		—			—		—			—		2		—			(6		)	—		—			130		—
Net derivatives(2)	91		(54		)	—		(54		)	—		—		—			(13		)	—		—			24		(66		)
All other, at fair value	—		—			—		—			4		—		(2		)	—			—		—			2		(2		)

Referenced footnotes are included after the prior period tables.

	3Q 2018
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,004		($3	)		($68	)		($71	)		$684			$—			($237	)		($199	)		$—		($91	)		$6,090		($4	)
Other agency	270		—			—			—			—			—			—			(2		)	—		(228		)	40		—
Non-agency and other	2,535		383			(66		)	317			—			—			(660		)	(134		)	—		—			2,058		10
Total available-for-sale mortgage-related securities	8,809		380			(134		)	246			684			—			(897		)	(335		)	—		(319		)	8,188		6
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,711		(140		)	—			(140		)	623			—			(875		)	(31		)	—		(108		)	3,180		(136		)
Other agency	17		(1		)	—			(1		)	—			—			—			1			—		—			17		(1		)
All other	1		—			—			—			—			—			—			—			—		—			1		—
Total trading mortgage-related securities	3,729		(141		)	—			(141		)	623			—			(875		)	(30		)	—		(108		)	3,198		(137		)
Other assets:
Guarantee asset	3,363		(28		)	—			(28		)	—			255			—			(147		)	—		—			3,443		(28		)
All other, at fair value	103		1			—			1			(3		)	(11		)	—			—			—		—			90		(4		)
Total other assets		$3,466		($27	)		$—			($27	)		($3	)		$244			$—			($147	)		$—		$—			$3,533		($32	)
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$629		($1	)		$—			($1	)		$—			$100			$—			$—			$—		$—			$728		($1	)
Other debt, at fair value	135		—			—			—			—			—			—			(1		)	—		—			134		—
Net derivatives(2)	42		8			—			8			—			41			—			(4		)	—		—			87		3

Referenced footnotes are included after the following table.

	YTD 2018
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,751		($13	)		($267	)		($280	)		$684		$—			($293	)		($772	)		$—		$—			$6,090		($13	)
Other agency	46		—			(1		)	(1		)	—		—			—			(5		)	—		—			40		—
Non-agency and other	4,291		876			(538		)	338			—		—			(2,160		)	(411		)	—		—			2,058		31
Total available-for-sale mortgage-related securities	11,088		863			(806		)	57			684		—			(2,453		)	(1,188		)	—		—			8,188		18
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	2,907		(383		)	—			(383		)	1,027		—			(863		)	(55		)	579		(32		)	3,180		(362		)
Other agency	9		(2		)	—			(2		)	30		—			(21		)	1			—		—			17		(2		)
All other	1		—			—			—			—		—			—			—			—		—			1		—
Total trading mortgage-related securities	2,917		(385		)	—			(385		)	1,057		—			(884		)	(54		)	579		(32		)	3,198		(364		)
Other assets:
Guarantee asset	3,171		(48		)	—			(48		)	—		745			—			(425		)	—		—			3,443		(48		)
All other, at fair value	45		31			—			31			38		(24		)	—			—			—		—			90		11
Total other assets		$3,216		($17	)		$—			($17	)		$38		$721			$—			($425	)		$—		$—			$3,533		($37	)
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$630		($2	)		$—			($2	)		$—		$100			$—			$—			$—		$—			$728		($2	)
Other debt, at fair value	137		—			—			—			—		—			—			(3		)	—		—			134		—
Net derivatives(2)	57		28			—			28			—		15			—			(13		)	—		—			87		15

(1) Transfers out of Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to an increased volume and level of activity in the market and availability of price quotes from dealers and third-party pricing services. Certain Freddie Mac securities are classified as Level 3 at issuance and generally are classified as Level 2 when they begin trading. Transfers into Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to a decrease in market activity and the availability of relevant price quotes from dealers and third-party pricing services.

(2) Amounts are the net of derivative assets and liabilities prior to counterparty netting, cash collateral netting, net trade/settle receivable or payable, and net derivative interest receivable or payable.

(3)

Represents the amount of total gains or losses for the period, included in earnings, attributable to the change in unrealized gains and losses related to assets and liabilities classified as Level 3 that were still held at September 30, 2019 and September 30, 2018, respectively. Included in these amounts are other-than temporary impairments recorded on available-for-sale securities.

The tables below provide valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 3 assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis.

Table 15.3 - Quantitative Information about Recurring Level 3 Fair Value Measurements

	September 30, 2019
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Assets
Available-for-sale, at fair value
Mortgage-related securities
Freddie Mac		$2,150	Discounted cash flows	OAS	30 - 261 bps	81 bps
Non-agency and other	979		Median of external sources	External pricing sources	$70.3 - $76.7		$73.5
	388		Other
Trading, at fair value
Mortgage-related securities
Freddie Mac	2,047		Single external source	External pricing sources	$0.0 - $102.4		$36.1
	883		Discounted cash flows	OAS	(831) - 8,095 bps	555 bps
Guarantee asset, at fair value	3,970		Discounted cash flows	OAS	17-186 bps	43 bps
	255		Other
Insignificant Level 3 assets(1)	182
Total level 3 assets		$10,854
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733	Single External Source	External Pricing Sources	$99.5 - $103.9		$100.4
Insignificant Level 3 liabilities(1)	156

Referenced footnote is included after the next table.

	December 31, 2018
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Assets
Available-for-sale, at fair value
Mortgage-related securities
Freddie Mac		$2,838	Discounted cash flows	OAS	30 - 325 bps	81 bps
	1,259		Single external source	External pricing sources	$96.1 - $104.1		$102.3
Non-agency and other	1,403		Median of external sources	External pricing sources	$64.3 - $71.1		$67.3
	237		Single external source	External pricing sources	$93.1 - $110.7		$100.7
Trading, at fair value
Mortgage-related securities
Freddie Mac	1,587		Single external source	External pricing sources	$0.0 - $99.2		$56.6
	1,178		Discounted cash flows	OAS	(21,945) - 6,639 bps	90 bps
	521		Other
Guarantee asset, at fair value	3,391		Discounted cash flows	OAS	17-198 bps	49 bps
	242		Other
Insignificant Level 3 assets(1)	184
Total level 3 assets		$12,840
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728	Single External Source	External Pricing Sources	$97.4 - $101.1		$99.6
Insignificant Level 3 liabilities(1)	226

(1)

Represents the aggregate amount of Level 3 assets or liabilities measured at fair value on a recurring basis that are individually and in the aggregate insignificant.

Assets Measured at Fair Value on a Non-Recurring Basis

We may be required, from time to time, to measure certain assets at fair value on a non-recurring basis. These adjustments usually result from the application of lower-of-cost-or-fair-value accounting or measurement of impairment based on the fair value of the underlying collateral. Certain of the fair values in the tables below were not obtained as of the period end, but were obtained during the period.

The table below presents assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 15.4 - Assets Measured at Fair Value on a Non-Recurring Basis

September 30, 2019

December 31, 2018

(In millions)

Level 1

Level 2

Level 3

Total

Level 1

Level 2

Level 3

Total

Assets measured at fair value on a non-recurring basis:

Mortgage loans(1)

$—

$429

$3,301

$3,730

$—

$24

$7,519

$7,543

(1)

Includes loans that are classified as held-for-investment and have been measured for impairment based on the fair value of the underlying collateral and held-for-sale loans where the fair value is below cost.

The tables below provide valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 3 assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 15.5 - Quantitative Information about Non-Recurring Level 3 Fair Value Measurements

	September 30, 2019
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Non-recurring fair value measurements
Mortgage loans		$3,301
			Internal model	Historical sales proceeds	$3,110 - $671,825	$185,551
			Internal model	Housing sales index	45 - 352 bps	113 bps
			Median of external sources	External pricing sources	$30.4 - $95.0	$85.1
	December 31, 2018
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Non-recurring fair value measurements
Mortgage loans		$7,519
			Internal model	Historical sales proceeds	$3,000 - $750,500	$177,725
			Internal model	Housing sales index	44 - 480 bps	108 bps
			Median of external sources	External pricing sources	$36.2 - $94.6	$82.5

Fair Value of Financial Instruments

The tables below present the carrying value and estimated fair value of our financial instruments. For certain types of financial instruments, such as cash and cash equivalents, securities purchased under agreements to resell, secured lending and other, and certain debt, the carrying value on our GAAP balance sheets approximates fair value, as these assets and liabilities are short-term in nature and have limited fair value volatility.

Table 15.6 - Fair Value of Financial Instruments

		September 30, 2019
	GAAP Measurement Category(1)	GAAP Carrying  Amount		Fair Value
(In millions)				Level 1		Level 2		Level 3		Netting  Adjustments(2)			Total
Financial Assets
Cash and cash equivalents	Amortized cost		$8,708		$8,693		$15		$—		$—			$8,708
Securities purchased under agreements to resell	Amortized cost	51,187		—		51,187		—		—			51,187
Investments in securities:
Available-for-sale, at fair value	FV - OCI	28,533		—		24,982		3,551		—			28,533
Trading, at fair value	FV - NI	44,449		21,952		19,561		2,936		—			44,449
Total investments in securities		72,982		21,952		44,543		6,487		—			72,982
Mortgage loans:
Loans held by consolidated trusts		1,905,633		—		1,714,292		223,324		—			1,937,616
Loans held by Freddie Mac		91,857		—		46,636		48,517		—			95,153
Total mortgage loans	Various(3)	1,997,490		—		1,760,928		271,841		—			2,032,769
Derivative assets, net	FV - NI	1,592		—		7,892		16		(6,316		)	1,592
Guarantee asset	FV - NI	4,225		—		—		4,233		—			4,233
Non-derivative purchase commitments, at fair value	FV - NI	223		—		229		1		—			230
Secured lending and other	Amortized cost	5,439		—		1,728		2,745		—			4,473
Total financial assets			$2,141,846		$30,645		$1,866,522		$285,323		($6,316	)		$2,176,174
Financial Liabilities
Debt, net:
Debt securities of consolidated trusts held by third parties			$1,869,308		$—		$1,898,887		$2,068		$—			$1,900,955
Other debt		279,951		—		281,229		3,757		—			284,986
Total debt, net	Various(4)	2,149,259		—		2,180,116		5,825		—			2,185,941
Derivative liabilities, net	FV - NI	355		—		6,437		40		(6,122		)	355
Guarantee obligation	Amortized cost	4,055		—		—		4,416		—			4,416
Non-derivative purchase commitments, at fair value	FV - NI	1		—		1		12		—			13
Total financial liabilities			$2,153,670		$—		$2,186,554		$10,293		($6,122	)		$2,190,725

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

(3) As of September 30, 2019, the GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $2.0 trillion, $19.6 billion, and $21.5 billion, respectively.

(4) As of September 30, 2019, the GAAP carrying amounts measured at amortized cost and FV - NI were $2.1 trillion and $4.6 billion, respectively.

		December 31, 2018
	GAAP Measurement Category(1)	GAAP Carrying  Amount		Fair Value
(In millions)				Level 1		Level 2		Level 3		Netting Adjustments(2)			Total
Financial Assets
Cash and cash equivalents	Amortized cost		$7,273		$7,273		$—		$—		$—			$7,273
Securities purchased under agreements to resell	Amortized cost	34,771		—		34,771		—		—			34,771
Investments in securities:
Available-for-sale, at fair value	FV - OCI	33,563		—		27,788		5,775		—			33,563
Trading, at fair value	FV - NI	35,548		15,885		16,369		3,294		—			35,548
Total investments in securities		69,111		15,885		44,157		9,069		—			69,111
Mortgage loans:
Loans held by consolidated trusts		1,842,850		—		1,605,874		209,542		—			1,815,416
Loans held by Freddie Mac		84,128		—		33,946		52,212		—			86,158
Total mortgage loans	Various(3)	1,926,978		—		1,639,820		261,754		—			1,901,574
Derivative assets, net	FV - NI	335		—		6,417		1		(6,083		)	335
Guarantee asset	FV - NI	3,633		—		—		3,642		—			3,642
Non-derivative purchase commitments, at fair value	FV - NI	159		—		159		2		—			161
Secured lending and other	Amortized cost	1,805		—		195		873		—			1,068
Total financial assets			$2,044,065		$23,158		$1,725,519		$275,341		($6,083	)		$2,017,935
Financial Liabilities
Debt, net:
Debt securities of consolidated trusts held by third parties			$1,792,677		$—		$1,759,911		$2,698		$—			$1,762,609
Other debt		252,273		—		251,543		3,629		—			255,172
Total debt, net	Various(4)	2,044,950		—		2,011,454		6,327		—			2,017,781
Derivative liabilities, net	FV - NI	583		—		4,336		92		(3,845		)	583
Guarantee obligation	Amortized cost	3,561		—		—		4,146		—			4,146
Non-derivative purchase commitments, at fair value	FV - NI	17		—		17		11		—			28
Total financial liabilities			$2,049,111		$—		$2,015,807		$10,576		($3,845	)		$2,022,538

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

(3) As of December 31, 2018, the GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $1.9 trillion, $18.5 billion, and $23.1 billion, respectively.

(4)

As of December 31, 2018, the GAAP carrying amounts measured at amortized cost and FV - NI were $2.0 trillion and $5.1 billion, respectively.

Fair Value Option

We elected the fair value option for certain multifamily held-for-sale loans, multifamily held-for-sale loan purchase commitments, and long-term debt.

The table below presents the fair value and UPB related to certain loans and long-term debt for which we have elected the fair value option. This table does not include interest-only securities related to debt securities of consolidated trusts and other debt held by third parties with a fair value of $61 million and $26 million and multifamily held-for-sale loan purchase commitments with a fair value of $222 million and $142 million, as of September 30, 2019 and December 31, 2018, respectively.

Table 15.7 - Difference between Fair Value and UPB for Certain Financial Instruments with Fair Value Option Elected

	September 30, 2019						December 31, 2018
(In millions)	Multifamily Held-For-Sale  Loans		Other Debt - Long Term		Debt Securities Of Consolidated Trusts Held By Third Parties		Multifamily Held-For-Sale  Loans		Other Debt - Long Term		Debt Securities Of Consolidated Trusts Held By Third Parties
Fair value		$21,538		$3,806		$733		$23,106		$4,357		$728
UPB	20,152		3,538		730		22,693		3,998		730
Difference		$1,386		$268		$3		$413		$359		($2	)

Changes in Fair Value Under the Fair Value Option Election

The table below presents the changes in fair value included in non-interest income (loss) in our condensed consolidated statements of comprehensive income, related to items for which we have elected the fair value option.

Table 15.8 - Changes in Fair Value Under the Fair Value Option Election

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(In millions)	Gains (Losses)						Gains (Losses)
Multifamily held-for-sale loans		$398			($285	)		$1,216			($797	)
Multifamily held-for-sale loan purchase commitments	641			267			1,644			564
Other debt - long term	49			10			116			38
Debt securities of consolidated trusts held by third parties	(1		)	2			(6		)	4

Changes in fair value attributable to instrument-specific credit risk were not material for 3Q 2019 and YTD 2019 and for 3Q 2018 and YTD 2018 for any assets or liabilities for which we elected the fair value option.

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Credit Enhancements (Tables)

9 Months Ended

Sep. 30, 2019

Credit Enhancements [Abstract]

Table - Mortgage Loan Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to our mortgage loan credit enhancements. For information about counterparty credit risk associated with credit enhancement providers, see Note 14.

Table 6.1 - Mortgage Loan Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage		Total Current and Protected UPB(1)		Maximum Coverage
Single-family:
Primary mortgage insurance		$410,999		$105,171		$378,594		$96,996
ACIS transactions(2)	869,148		10,081		807,885		9,123
STACR Trust transactions	280,889		9,154		161,152		5,026
Other	28,347		6,070		18,136		5,389
Total mortgage loan credit enhancements				$130,476				$116,534

(1) Underlying loans may be covered by more than one form of credit enhancement.

(2)

As of September 30, 2019 and December 31, 2018, our counterparties posted collateral on our ACIS transactions of $2.0 billion and $1.5 billion, respectively.

Table - Guaranteed Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to our single-family and multifamily guarantee credit enhancements.

Table 6.2 - Guarantee Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage(2)		Total Current and Protected UPB(1)		Maximum Coverage(2)
Single-family:
Subordination (non-consolidated VIEs)		$22,876		$4,076		$16,271		$2,933
Other	1,129		1,129		1,226		1,226
Total single-family			5,205				4,159
Multifamily:
Subordination (non-consolidated VIEs)	240,485		38,645		220,733		35,661
Other	3,204		919		2,349		815
Total multifamily			39,564				36,476
Total guarantee credit enhancements				$44,769				$40,635

(1) Underlying loans may be covered by more than one form of credit enhancement. For subordination, total current and protected UPB includes the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities, and the UPB of guarantor advances made to the holders of the guaranteed securities.

(2)

For subordination, maximum coverage represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties. For all other credit enhancements, maximum coverage represents the remaining amount of loss recovery that is available subject to the terms of counterparty agreements.

Table - Debt with Embedded Credit Enhancements

The table below presents the total current and protected UPB and maximum amounts of potential loss recovery related to debt with embedded credit enhancements.

Table 6.3 - Debt with Embedded Credit Enhancements

	September 30, 2019				December 31, 2018
(In millions)	Total Current and Protected UPB(1)		Maximum Coverage(2)		Total Current and Protected UPB(1)		Maximum Coverage(2)
Single-family:
STACR debt notes		$554,572		$15,962		$605,263		$17,596
Subordination (consolidated VIEs)	21,843		943		25,006		1,036
Total single-family			16,905				18,632
Multifamily:
SCR notes	2,523		126		2,667		133
Subordination (consolidated VIEs)	2,700		280		2,700		280
Total multifamily			406				413
Total debt with embedded credit enhancements				$17,311				$19,045

(1) Underlying loans may be covered by more than one form of credit enhancement. For STACR debt notes and SCR notes, total current and protected UPB represents the UPB of the assets included in the reference pool. For subordination, total current and protected UPB represents the UPB of the guaranteed securities, which represents the UPB of the assets included in the trust net of the protection provided by the subordinated securities.

(2)

For STACR debt notes and SCR notes, maximum coverage amount represents the outstanding balance of the STACR debt notes and SCR notes held by third parties. For subordination, maximum coverage amount represents the outstanding UPB of the securities that are subordinate to Freddie Mac guaranteed securities and held by third parties.

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Stockholders' Equity and Earnings per Share

9 Months Ended

Sep. 30, 2019

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' EQUITY (DEFICIT)

Stockholders' Equity and Earnings Per Share

Accumulated Other Comprehensive Income

The tables below present changes in AOCI after the effects of our federal statutory tax rate of 21% for YTD 2019 and YTD 2018, related to available-for-sale securities, closed cash flow hedges, and our defined benefit plans.

Table 11.1 - Changes in AOCI by Component, Net of Taxes

	YTD 2019
(In millions)	AOCI Related to Available- For-Sale Securities			AOCI Related to Cash Flow Hedge Relationships			AOCI Related to Defined Benefit Plans			Total
Beginning balance		$83			($315	)		$97			($135	)
Other comprehensive income before reclassifications	776			—			(2		)	774
Amounts reclassified from accumulated other comprehensive income	(102		)	57			(12		)	(57		)
Changes in AOCI by component	674			57			(14		)	717
Ending balance		$757			($258	)		$83			$582
	YTD 2018
(In millions)	AOCI Related to Available- For-Sale Securities			AOCI Related to Cash Flow Hedge Relationships			AOCI Related to Defined Benefit Plans			Total
Beginning balance		$662			($356	)		$83			$389
Other comprehensive income before reclassifications	(821		)	—			(1		)	(822		)
Amounts reclassified from accumulated other comprehensive income	(244		)	87			(12		)	(169		)
Changes in AOCI by component	(1,065		)	87			(13		)	(991		)
Cumulative effect of change in accounting principle(1)	143			(73		)	19			89
Ending balance		($260	)		($342	)		$89			($513	)

(1)

Includes the effect of adopting the accounting guidance on reclassification of stranded tax effects of the Tax Cuts and Jobs Act in 1Q 2018.

Reclassifications from AOCI to Net Income

The table below presents reclassifications from AOCI to net income, including the affected line item in our condensed consolidated statements of comprehensive income.

Table 11.2 - Reclassifications from AOCI to Net Income

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
AOCI related to available-for-sale securities
Affected line items in the consolidated statements of comprehensive income:
Investment securities gains (losses)		$62			($64	)		$129			$309
Income tax (expense) or benefit	(13		)	13			(27		)	(65		)
Net of tax	49			(51		)	102			244
AOCI related to cash flow hedge relationships
Affected line items in the consolidated statements of comprehensive income:
Interest expense	(24		)	(31		)	(72		)	(106		)
Income tax (expense) or benefit	5			6			15			19
Net of tax	(19		)	(25		)	(57		)	(87		)
AOCI related to defined benefit plans
Affected line items in the consolidated statements of comprehensive income:
Salaries and employee benefits	5			5			15			15
Income tax (expense) or benefit	(1		)	(1		)	(3		)	(3		)
Net of tax	4			4			12			12
Total reclassifications in the period net of tax		$34			($72	)		$57			$169

Future Reclassifications from AOCI to Net Income Related to Closed Cash Flow Hedges

The total AOCI related to derivatives designated as cash flow hedges was a loss of $0.3 billion at both September 30, 2019 and September 30, 2018, composed of deferred net losses on closed cash flow hedges. Closed cash flow hedges involve derivatives that have been terminated or are no longer designated as cash flow hedges. Fluctuations in prevailing market interest rates have no effect on the deferred portion of AOCI relating to losses on closed cash flow hedges.

The previously deferred amount related to closed cash flow hedges remains in our AOCI balance and will be recognized into earnings over the expected time period for which the forecasted transactions affect earnings, unless it is deemed probable that the forecasted transactions will not occur. Over the next 12 months, we estimate that approximately $49 million, net of taxes, of the $0.3 billion of cash flow hedge losses in AOCI at September 30, 2019 will be reclassified into earnings. The maximum remaining length of time over which we have hedged the exposure related to the variability in future cash flows on forecasted transactions, primarily forecasted debt issuances, is 14 years.

Senior Preferred Stock

Pursuant to the September 2019 Letter Agreement, for each dividend period from July 1, 2019 and thereafter, the applicable Capital Reserve Amount used in determining the dividend payable to Treasury will be $20.0 billion, rather than $3.0 billion as previously provided. As a result of this change, we did not have a dividend requirement to Treasury in September 2019, as our Net Worth Amount of $4.8 billion as of June 30, 2019 was lower than the $20.0 billion applicable Capital Reserve Amount.

As of September 30, 2019, our assets exceeded our liabilities under GAAP; therefore, no draw is being requested from Treasury under the Purchase Agreement. Based on our Net Worth Amount of $6.7 billion as of September 30, 2019 and the applicable Capital Reserve Amount of $20.0 billion, we will not have a dividend requirement to Treasury in December 2019. See Note 2 for additional information. Our cumulative senior preferred stock dividend payments remain at $119.7 billion as of September 30, 2019.

The aggregate liquidation preference of the senior preferred stock owned by Treasury was $75.6 billion as of June 30, 2019. Pursuant to the September 2019 Letter Agreement, the liquidation preference of the senior preferred stock will be increased, at the end of each fiscal quarter, beginning on September 30, 2019, by an amount equal to the increase in the Net Worth Amount, if any, during the immediately prior fiscal quarter, until the liquidation preference has increased by $17.0 billion. During 2Q 2019, our Net Worth Amount increased by $1.8 billion. As a result, the liquidation preference of the senior preferred stock increased to

$77.5 billion on September 30, 2019, and will increase to $79.3 billion on December 31, 2019 based on the $1.8 billion increase in our Net Worth Amount during 3Q 2019.

The table below provides a summary of our senior preferred stock outstanding at September 30, 2019.

Table 11.3 - Senior Preferred Stock

(In millions, except initial liquidation preference price per share)	Shares Authorized	Shares Outstanding	Total Par Value		Initial Liquidation Preference Price per Share		Total Liquidation Preference
Non-draw Adjustment Dates:
September 8, 2008	1.00	1.00		$1.00		$1,000		$1,000
December 31, 2017	—	—	—		N/A		3,000
September 30, 2019	—	—	—		N/A		1,826
Draw Dates:
November 24, 2008	—	—	—		N/A		13,800
March 31, 2009	—	—	—		N/A		30,800
June 30, 2009	—	—	—		N/A		6,100
June 30, 2010	—	—	—		N/A		10,600
September 30, 2010	—	—	—		N/A		1,800
December 30, 2010	—	—	—		N/A		100
March 31, 2011	—	—	—		N/A		500
September 30, 2011	—	—	—		N/A		1,479
December 30, 2011	—	—	—		N/A		5,992
March 30, 2012	—	—	—		N/A		146
June 29, 2012	—	—	—		N/A		19
March 30, 2018	—	—	—		N/A		312
Total senior preferred stock	1.00	1.00		$1.00				$77,474

Stock Issuances and Repurchases

We did not repurchase or issue any of our common shares or non-cumulative preferred stock during 3Q 2019.

Earnings Per Share

We have participating securities related to restricted stock units with dividend equivalent rights that receive dividends as declared on an equal basis with common shares but are not obligated to participate in undistributed net losses. These participating securities consist of vested RSUs that earn dividend equivalents at the same rate when and as declared on common stock.

Consequently, in accordance with accounting guidance, we use the "two-class" method of computing earnings per common share. The "two-class" method is an earnings allocation formula that determines earnings per share for common stock and participating securities based on dividends declared and participation rights in undistributed earnings.

Basic earnings per common share is computed as net income attributable to common stockholders divided by the weighted average common shares outstanding for the period. The weighted average common shares outstanding for the period includes the weighted average number of shares that are associated with the warrant for our common stock issued to Treasury pursuant to the Purchase Agreement. These shares are included since the warrant is unconditionally exercisable by the holder at a minimal cost.

Diluted earnings per common share is computed as net income attributable to common stockholders divided by the weighted average common shares outstanding during the period adjusted for the dilutive effect of common equivalent shares outstanding. For periods with net income attributable to common stockholders, the calculation includes the effect of the weighted-average of RSUs.

During periods in which a net loss attributable to common stockholders has been incurred, potential common equivalent shares outstanding are not included in the calculation because it would have an antidilutive effect.

There were no stock options outstanding at both September 30, 2019 and September 30, 2018.

Dividends and Dividend Restrictions

No common dividends were declared during YTD 2019. At the direction of our Conservator, we paid dividends of $1.5 billion and $1.7 billion on the senior preferred stock during 1Q 2019 and 2Q 2019, respectively. As a result of the increase in the applicable Capital Reserve Amount pursuant to the September 2019 Letter Agreement, we did not declare or pay a dividend on the senior preferred stock during 3Q 2019. We also did not declare or pay dividends on any other series of Freddie Mac preferred stock outstanding during YTD 2019.

Our payment of dividends on Freddie Mac common stock or any series of Freddie Mac preferred stock (other than senior preferred stock) is subject to certain restrictions as described in Note 11 in our 2018 Annual Report.

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Investments in Securities

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

INVESTMENTS IN SECURITIES

Investments in Securities

The table below summarizes the fair values of our investments in debt securities by classification.

Table 7.1 - Investments in Securities

(In millions)	September 30, 2019		December 31, 2018
Trading securities		$44,449		$35,548
Available-for-sale securities	28,533		33,563
Total fair value of investments in securities		$72,982		$69,111

As of September 30, 2019 and December 31, 2018, we did not classify any securities as held-to-maturity, although we may elect to do so in the future.

Trading Securities

The table below presents the estimated fair values of our trading securities by major security type. Our non-mortgage-related securities primarily consist of investments in U.S. Treasury securities.

Table 7.2 - Trading Securities

(In millions)	September 30, 2019		December 31, 2018
Mortgage-related securities:
Freddie Mac		$12,972		$13,821
Other agency	7,194		2,551
Non-agency	1		1
Total mortgage-related securities	20,167		16,373
Non-mortgage-related securities	24,282		19,175
Total fair value of trading securities		$44,449		$35,548

For trading securities held at September 30, 2019, we recorded net unrealized gains (losses) of $27 million and $310 million during 3Q 2019 and YTD 2019, respectively. For trading securities held at September 30, 2018, we recorded net unrealized gains (losses) of ($305) million and ($951) million during 3Q 2018 and YTD 2018, respectively.

Available-for-Sale Securities

At September 30, 2019 and December 31, 2018, all available-for-sale securities were mortgage-related securities.

The tables below present the amortized cost, gross unrealized gains and losses, and fair value by major security type for our securities classified as available-for-sale.

Table 7.3 - Available-for-Sale Securities

	September 30, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses					Fair Value
(In millions)					Other-Than-Temporary Impairment(1)		Temporary Impairment(2)
Available-for-sale securities:
Freddie Mac		$25,492		$707		$—		($80	)		$26,119
Other agency	1,005		26		—		(5		)	1,026
Non-agency and other	1,078		310		—		—			1,388
Total available-for-sale securities		$27,575		$1,043		$—		($85	)		$28,533

	December 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses					Fair Value
(In millions)					Other-Than-Temporary Impairment(1)		Temporary Impairment(2)
Available-for-sale securities:
Freddie Mac		$30,407		$320		$—		($528	)		$30,199
Other agency	1,675		38		—		(7		)	1,706
Non-agency and other	1,378		282		—		(2		)	1,658
Total available-for-sale securities		$33,460		$640		$—		($537	)		$33,563

(1) Represents the gross unrealized losses for securities for which we have previously recognized other-than-temporary impairment in earnings.

(2) Represents the gross unrealized losses for securities for which we have not previously recognized other-than-temporary impairment in earnings.

The fair value of our available-for-sale securities held at September 30, 2019 scheduled to contractually mature after ten years was $24.0 billion, with an additional $4.1 billion scheduled to contractually mature after five years through ten years.

Available-for-Sale Securities in a Gross Unrealized Loss Position

The tables below present available-for-sale securities in a gross unrealized loss position and whether such securities have been in an unrealized loss position for less than 12 months, or 12 months or greater.

Table 7.4 - Available-for-Sale Securities in a Gross Unrealized Loss Position

	September 30, 2019
	Less than 12 Months					12 Months or Greater
(In millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Available-for-sale securities:
Freddie Mac		$5,312		($41	)		$2,951		($39	)
Other agency	56		—			531		(5		)
Non-agency and other	—		—			—		—
Total available-for-sale securities in a gross unrealized loss position		$5,368		($41	)		$3,482		($44	)

	December 31, 2018
	Less than 12 Months					12 Months or Greater
(In millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Available-for-sale securities:
Freddie Mac		$4,259		($38	)		$14,751		($490	)
Other agency	351		(1		)	638		(6		)
Non-agency and other	43		(1		)	6		(1		)
Total available-for-sale securities in a gross unrealized loss position		$4,653		($40	)		$15,395		($497	)

At September 30, 2019, the gross unrealized losses relate to 150 separate securities.

Realized Gains and Losses on Sales of Available-for-Sale Securities

The table below summarizes the gross realized gains and gross realized losses from the sale of available-for-sale securities.

Table 7.5 - Gross Realized Gains and Gross Realized Losses from Sales of Available-for-Sale Securities

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Gross realized gains		$68			$69			$169			$544
Gross realized losses	(6		)	(131		)	(40		)	(232		)
Net realized gains (losses)		$62			($62	)		$129			$312

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Regulatory Capital (Tables)

9 Months Ended

Sep. 30, 2019

Mortgage Banking [Abstract]

Table - Net Worth and Minimum Capital

We continue to provide quarterly submissions to FHFA on minimum capital. The table below summarizes our minimum capital requirements and deficits and net worth.

Table 17.1 - Net Worth and Minimum Capital

(In millions)	September 30, 2019			December 31, 2018
GAAP net worth (deficit)		$6,674			$4,477
Core capital (deficit)(1)(2)	(66,556		)	(68,036		)
Less: Minimum capital requirement(1)	18,817			17,553
Minimum capital surplus (deficit)(1)		($85,373	)		($85,589	)

(1) Core capital and minimum capital figures are estimates and represent amounts submitted to FHFA. FHFA is the authoritative source for our regulatory capital.

(2)

Core capital excludes certain components of GAAP total equity (i.e., AOCI and the liquidation preference of the senior preferred stock) as these items do not meet the statutory definition of core capital.

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Investments in Securities (Tables)

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

Table - Investments in Securities

The table below summarizes the fair values of our investments in debt securities by classification.

Table 7.1 - Investments in Securities

(In millions)	September 30, 2019		December 31, 2018
Trading securities		$44,449		$35,548
Available-for-sale securities	28,533		33,563
Total fair value of investments in securities		$72,982		$69,111

Table - Trading Securities

The table below presents the estimated fair values of our trading securities by major security type. Our non-mortgage-related securities primarily consist of investments in U.S. Treasury securities.

Table 7.2 - Trading Securities

(In millions)	September 30, 2019		December 31, 2018
Mortgage-related securities:
Freddie Mac		$12,972		$13,821
Other agency	7,194		2,551
Non-agency	1		1
Total mortgage-related securities	20,167		16,373
Non-mortgage-related securities	24,282		19,175
Total fair value of trading securities		$44,449		$35,548

Table - Available-For-Sale Securities

The tables below present the amortized cost, gross unrealized gains and losses, and fair value by major security type for our securities classified as available-for-sale.

Table 7.3 - Available-for-Sale Securities

	September 30, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses					Fair Value
(In millions)					Other-Than-Temporary Impairment(1)		Temporary Impairment(2)
Available-for-sale securities:
Freddie Mac		$25,492		$707		$—		($80	)		$26,119
Other agency	1,005		26		—		(5		)	1,026
Non-agency and other	1,078		310		—		—			1,388
Total available-for-sale securities		$27,575		$1,043		$—		($85	)		$28,533

	December 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses					Fair Value
(In millions)					Other-Than-Temporary Impairment(1)		Temporary Impairment(2)
Available-for-sale securities:
Freddie Mac		$30,407		$320		$—		($528	)		$30,199
Other agency	1,675		38		—		(7		)	1,706
Non-agency and other	1,378		282		—		(2		)	1,658
Total available-for-sale securities		$33,460		$640		$—		($537	)		$33,563

(1) Represents the gross unrealized losses for securities for which we have previously recognized other-than-temporary impairment in earnings.

(2)

Represents the gross unrealized losses for securities for which we have not previously recognized other-than-temporary impairment in earnings.

Table - Available-For-Sale Securities in a Gross Unrealized Loss Position

The tables below present available-for-sale securities in a gross unrealized loss position and whether such securities have been in an unrealized loss position for less than 12 months, or 12 months or greater.

Table 7.4 - Available-for-Sale Securities in a Gross Unrealized Loss Position

	September 30, 2019
	Less than 12 Months					12 Months or Greater
(In millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Available-for-sale securities:
Freddie Mac		$5,312		($41	)		$2,951		($39	)
Other agency	56		—			531		(5		)
Non-agency and other	—		—			—		—
Total available-for-sale securities in a gross unrealized loss position		$5,368		($41	)		$3,482		($44	)

	December 31, 2018
	Less than 12 Months					12 Months or Greater
(In millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Available-for-sale securities:
Freddie Mac		$4,259		($38	)		$14,751		($490	)
Other agency	351		(1		)	638		(6		)
Non-agency and other	43		(1		)	6		(1		)
Total available-for-sale securities in a gross unrealized loss position		$4,653		($40	)		$15,395		($497	)

Table - Gross Realized Gains and Gross Realized Losses on Sales of Available-For-Sale Securities

The table below summarizes the gross realized gains and gross realized losses from the sale of available-for-sale securities.

Table 7.5 - Gross Realized Gains and Gross Realized Losses from Sales of Available-for-Sale Securities

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Gross realized gains		$68			$69			$169			$544
Gross realized losses	(6		)	(131		)	(40		)	(232		)
Net realized gains (losses)		$62			($62	)		$129			$312

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Stockholders' Equity and Earnings per Share (Tables)

9 Months Ended

Sep. 30, 2019

Stockholders' Equity Note [Abstract]

Table - Changes in AOCI by Component, Net of Tax

The tables below present changes in AOCI after the effects of our federal statutory tax rate of 21% for YTD 2019 and YTD 2018, related to available-for-sale securities, closed cash flow hedges, and our defined benefit plans.

Table 11.1 - Changes in AOCI by Component, Net of Taxes

	YTD 2019
(In millions)	AOCI Related to Available- For-Sale Securities			AOCI Related to Cash Flow Hedge Relationships			AOCI Related to Defined Benefit Plans			Total
Beginning balance		$83			($315	)		$97			($135	)
Other comprehensive income before reclassifications	776			—			(2		)	774
Amounts reclassified from accumulated other comprehensive income	(102		)	57			(12		)	(57		)
Changes in AOCI by component	674			57			(14		)	717
Ending balance		$757			($258	)		$83			$582
	YTD 2018
(In millions)	AOCI Related to Available- For-Sale Securities			AOCI Related to Cash Flow Hedge Relationships			AOCI Related to Defined Benefit Plans			Total
Beginning balance		$662			($356	)		$83			$389
Other comprehensive income before reclassifications	(821		)	—			(1		)	(822		)
Amounts reclassified from accumulated other comprehensive income	(244		)	87			(12		)	(169		)
Changes in AOCI by component	(1,065		)	87			(13		)	(991		)
Cumulative effect of change in accounting principle(1)	143			(73		)	19			89
Ending balance		($260	)		($342	)		$89			($513	)

(1)

Includes the effect of adopting the accounting guidance on reclassification of stranded tax effects of the Tax Cuts and Jobs Act in 1Q 2018.

Table - Reclassifications from AOCI to Net Income

The table below presents reclassifications from AOCI to net income, including the affected line item in our condensed consolidated statements of comprehensive income.

Table 11.2 - Reclassifications from AOCI to Net Income

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
AOCI related to available-for-sale securities
Affected line items in the consolidated statements of comprehensive income:
Investment securities gains (losses)		$62			($64	)		$129			$309
Income tax (expense) or benefit	(13		)	13			(27		)	(65		)
Net of tax	49			(51		)	102			244
AOCI related to cash flow hedge relationships
Affected line items in the consolidated statements of comprehensive income:
Interest expense	(24		)	(31		)	(72		)	(106		)
Income tax (expense) or benefit	5			6			15			19
Net of tax	(19		)	(25		)	(57		)	(87		)
AOCI related to defined benefit plans
Affected line items in the consolidated statements of comprehensive income:
Salaries and employee benefits	5			5			15			15
Income tax (expense) or benefit	(1		)	(1		)	(3		)	(3		)
Net of tax	4			4			12			12
Total reclassifications in the period net of tax		$34			($72	)		$57			$169

Table - Senior Preferred Stock

The table below provides a summary of our senior preferred stock outstanding at September 30, 2019.

Table 11.3 - Senior Preferred Stock

(In millions, except initial liquidation preference price per share)	Shares Authorized	Shares Outstanding	Total Par Value		Initial Liquidation Preference Price per Share		Total Liquidation Preference
Non-draw Adjustment Dates:
September 8, 2008	1.00	1.00		$1.00		$1,000		$1,000
December 31, 2017	—	—	—		N/A		3,000
September 30, 2019	—	—	—		N/A		1,826
Draw Dates:
November 24, 2008	—	—	—		N/A		13,800
March 31, 2009	—	—	—		N/A		30,800
June 30, 2009	—	—	—		N/A		6,100
June 30, 2010	—	—	—		N/A		10,600
September 30, 2010	—	—	—		N/A		1,800
December 30, 2010	—	—	—		N/A		100
March 31, 2011	—	—	—		N/A		500
September 30, 2011	—	—	—		N/A		1,479
December 30, 2011	—	—	—		N/A		5,992
March 30, 2012	—	—	—		N/A		146
June 29, 2012	—	—	—		N/A		19
March 30, 2018	—	—	—		N/A		312
Total senior preferred stock	1.00	1.00		$1.00				$77,474

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Guarantee Activities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Guarantor Obligations [Line Items]
Investments in securities, at fair value	$ 72,982	$ 69,111
Other agency | Freddie Mac resecuritization trust
Guarantor Obligations [Line Items]
Investments in securities, at fair value	$ 17,000

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Mortgage Loans and Loan Loss Reserves - Net Investment in Loans (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Financing Receivable, Allowance for Credit Loss [Line Items]
Recorded investment, collectively evaluated	$ 1,921,021	$ 1,844,989
Recorded investment, individually evaluated	40,205	46,506
Total recorded investment	1,961,226	1,891,495
Allowance for loan losses, collectively evaluated	(1,528)	(1,770)
Allowance for loan losses, individually evaluated	(3,326)	(4,369)
Total ending balance of the allowance	(4,854)	(6,139)
Total held-for-investment mortgage loans, net	1,956,372	1,885,356
Single-family
Financing Receivable, Allowance for Credit Loss [Line Items]
Recorded investment, collectively evaluated	1,904,203	1,830,044
Recorded investment, individually evaluated	40,124	46,421
Total recorded investment	1,944,327	1,876,465
Allowance for loan losses, collectively evaluated	(1,515)	(1,761)
Allowance for loan losses, individually evaluated	(3,326)	(4,369)
Total ending balance of the allowance	(4,841)	(6,130)
Total held-for-investment mortgage loans, net	1,939,486	1,870,335
Multifamily
Financing Receivable, Allowance for Credit Loss [Line Items]
Recorded investment, collectively evaluated	16,818	14,945
Recorded investment, individually evaluated	81	85
Total recorded investment	16,899	15,030
Allowance for loan losses, collectively evaluated	(13)	(9)
Allowance for loan losses, individually evaluated	0	0
Total ending balance of the allowance	(13)	(9)
Total held-for-investment mortgage loans, net	$ 16,886	$ 15,021

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Credit Enhancements - Debt with Embedded Credit Enhancements (Details) - Debt with Embedded Credit Enhancements - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Credit Enhancement [Line Items]
Maximum coverage	$ 17,311	$ 19,045
Single-family
Credit Enhancement [Line Items]
Maximum coverage	16,905	18,632
Single-family | STACR debt notes
Credit Enhancement [Line Items]
Total current and protected UPB	554,572	605,263
Maximum coverage	15,962	17,596
Single-family | Consolidated VIE subordination
Credit Enhancement [Line Items]
Total current and protected UPB	21,843	25,006
Maximum coverage	943	1,036
Multifamily
Credit Enhancement [Line Items]
Maximum coverage	406	413
Multifamily | Consolidated VIE subordination
Credit Enhancement [Line Items]
Total current and protected UPB	2,700	2,700
Maximum coverage	280	280
Multifamily | SCR debt notes
Credit Enhancement [Line Items]
Total current and protected UPB	2,523	2,667
Maximum coverage	$ 126	$ 133

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Stockholders' Equity and Earnings per Share - Reclassifications from AOCI to Net Income (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Investment securities gains (losses)	$ 164	$ (443)	$ 728	$ (1,024)
Interest expense	(15,130)	(14,546)	(46,498)	(42,802)
Salaries and employee benefits	(333)	(301)	(983)	(890)
Income before income tax (expense) benefit	2,136	3,262	5,799	10,081
Income tax (expense) benefit	(427)	(556)	(1,177)	(1,946)
Net income (loss)	1,709	2,706	4,622	8,135
Held by Freddie Mac
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Interest expense	(1,806)	(1,719)	(5,497)	(4,806)
Total reclassifications in the period
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Net income (loss)	34	(72)	57	169
AOCI related to available-for-sale securities | Total reclassifications in the period
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Investment securities gains (losses)	62	(64)	129	309
Income tax (expense) benefit	(13)	13	(27)	(65)
Net income (loss)	49	(51)	102	244
AOCI related to cash flow hedge relationships | Total reclassifications in the period
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Income tax (expense) benefit	5	6	15	19
Net income (loss)	(19)	(25)	(57)	(87)
AOCI related to cash flow hedge relationships | Total reclassifications in the period | Held by Freddie Mac
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Interest expense	(24)	(31)	(72)	(106)
AOCI related to defined benefit plans | Total reclassifications in the period
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Salaries and employee benefits	5	5	15	15
Income tax (expense) benefit	(1)	(1)	(3)	(3)
Net income (loss)	$ 4	$ 4	$ 12	$ 12

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Derivatives - Derivative Gains and Losses (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	$ (1,217)	$ 728	$ (4,912)	$ 2,974
Accrual of periodic settlements
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(47)	27	(143)	(161)
Accrual of periodic settlements | Receive-fixed
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	39	39	(32)	335
Accrual of periodic settlements | Pay-fixed
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(126)	(50)	(220)	(536)
Accrual of periodic settlements | Other
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	40	38	109	40
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Interest Rate Swaps
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(1,809)	736	(4,565)	2,833
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Receive-fixed
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	2,060	(1,004)	7,580	(5,080)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Pay-fixed
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(3,866)	1,721	(12,152)	7,922
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Basis (floating to floating)
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(3)	19	7	(9)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Option-based
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	947	(306)	1,408	(1,020)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Call swaptions | Purchased
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	1,398	(402)	2,981	(1,392)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Call swaptions | Written
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(109)	35	(343)	76
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Put swaptions | Purchased
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(355)	136	(1,406)	524
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Put swaptions | Written
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	19	(2)	83	(23)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Other option-based derivatives
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(6)	(73)	93	(205)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Other Derivatives
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(308)	271	(1,612)	1,322
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Futures
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(262)	277	(1,283)	728
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Commitments
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	(54)	69	(366)	672
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Credit derivatives
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	6	(4)	1	(14)
Not Designated as Hedging Instrument, Economic Hedge | Derivative gains (losses) excluding accrual of periodic settlements | Other
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gains (losses)	$ 2	$ (71)	$ 36	$ (64)

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Collateral and Offsetting of Assets and Liabilities - Offsetting of Financial Assets (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Derivative Assets:
Gross Amount Recognized	$ 8,820	$ 7,307
Counterparty netting	(5,374)	(4,544)
Cash Collateral netting	(1,854)	(2,428)
Derivative Assets, net	1,592	335
Gross Amount Not Offset in the Consolidated Balance Sheets	(1,191)	(173)
Net Amount	401	162
Securities purchased under agreements to resell:
Gross Amount Recognized	51,187	34,771
Counterparty netting	0	0
Net Amount Presented in the Consolidated Balance Sheets	51,187	34,771
Gross Amount Not Offset in the Consolidated Balance Sheets	(51,187)	(34,771)
Net Amount	0	0
Total:
Gross Amount Recognized	60,007	42,078
Counterparty netting	(5,374)	(4,544)
Cash collateral netting	(1,854)	(2,428)
Net Amount Presented in the Consolidated Balance Sheets	52,779	35,106
Gross Amount Not Offset in the Consolidated Balance Sheets	(52,378)	(34,944)
Net Amount	401	162
Other
Derivative Assets:
Gross Amount Recognized	208	91
Counterparty netting	0	0
Cash Collateral netting	0	0
Derivative Assets, net	208	91
Gross Amount Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	208	91
OTC derivatives
Derivative Assets:
Gross Amount Recognized	8,583	7,213
Counterparty netting	(5,373)	(4,544)
Cash Collateral netting	(1,975)	(2,448)
Derivative Assets, net	1,235	221
Gross Amount Not Offset in the Consolidated Balance Sheets	(1,191)	(173)
Net Amount	44	48
Federal Funds Sold and Securities Borrowed or Purchased under Agreements to Resell [Member]
Securities purchased under agreements to resell:
Cash Collateral Netting	0	0
Cleared and exchange-traded derivatives
Derivative Assets:
Gross Amount Recognized	29	3
Counterparty netting	(1)	0
Cash Collateral netting	121	20
Derivative Assets, net	149	23
Gross Amount Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	$ 149	$ 23

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Segment Reporting - Segment Earnings (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Segment Reporting Information [Line Items]
Net income (loss)	$ 1,709	$ 2,706	$ 4,622	$ 8,135
Comprehensive income (loss)	1,848	2,559	5,339	7,144
All Other
Segment Reporting Information [Line Items]
Net income (loss)	0	0	0	0
Comprehensive income (loss)	0	0	0	0
Single-family Guarantee | Operating segments
Segment Reporting Information [Line Items]
Net income (loss)	1,250	1,183	2,945	2,884
Comprehensive income (loss)	1,247	1,181	2,936	2,876
Multifamily | Operating segments
Segment Reporting Information [Line Items]
Net income (loss)	581	549	1,294	1,572
Comprehensive income (loss)	591	505	1,426	1,436
Capital Markets | Operating segments
Segment Reporting Information [Line Items]
Net income (loss)	(122)	974	383	3,679
Comprehensive income (loss)	10	873	977	2,832
Operating segments and All Other
Segment Reporting Information [Line Items]
Net income (loss)	1,709	2,706	4,622	8,135
Comprehensive income (loss)	$ 1,848	$ 2,559	$ 5,339	$ 7,144

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Consolidated Balance Sheets - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Assets
Cash and cash equivalents (Notes 1, 3, 14) (includes $3,560 and $596 of restricted cash and cash equivalents)	$ 8,708	$ 7,273
Securities purchased under agreements to resell (Notes 3, 10)	51,187	34,771
Investments in securities, at fair value (Note 7)	72,982	69,111
Mortgage loans held-for-sale (Notes 3, 4) (includes $21,538 and $23,106 at fair value)	41,118	41,622
Mortgage loans held-for-investment (Notes 3, 4) (net of allowance for loan losses of $4,854 and $6,139)	1,956,372	1,885,356
Accrued interest receivable (Note 3)	6,790	6,728
Derivative assets, net (Notes 9, 10)	1,592	335
Deferred tax assets, net (Note 12)	5,784	6,888
Other assets (Notes 3, 18) (includes $4,590 and $3,929 at fair value)	25,713	10,976
Total assets	2,170,246	2,063,060
Liabilities
Accrued interest payable (Note 3)	6,688	6,652
Debt, net (Notes 3, 8) (includes $4,600 and $5,112 at fair value)	2,149,259	2,044,950
Derivative liabilities, net (Notes 9, 10)	355	583
Other liabilities (Notes 3, 18)	7,270	6,398
Total liabilities	2,163,572	2,058,583
Commitments and contingencies (Notes 5, 9, 16)
Equity (Note 11)
Senior preferred stock (redemption value of $77,474 and $75,648)	72,648	72,648
Preferred stock, at redemption value	14,109	14,109
Common stock, $0.00 par value, 4,000,000,000 shares authorized, 725,863,886 shares issued and 650,059,033 shares and 650,058,775 shares outstanding	0	0
Additional paid-in capital	0	0
Retained earnings (accumulated deficit)	(76,780)	(78,260)
AOCI, net of taxes, related to:
Available-for-sale securities (includes $243 and $221, related to net unrealized gains on securities for which other-than-temporary impairment has been recognized in earnings)	757	83
Cash flow hedge relationships	(258)	(315)
Defined benefit plans	83	97
Total AOCI, net of taxes	582	(135)
Treasury stock, at cost, 75,804,853 shares and 75,805,111 shares	(3,885)	(3,885)
Total equity (See Note 11 for information on our dividend requirement to Treasury)	6,674	4,477
Total liabilities and equity	2,170,246	2,063,060
Consolidated Balance Sheet Line Item
Mortgage loans held-for-investment (Notes 3, 4) (net of allowance for loan losses of $4,854 and $6,139)	1,956,372	1,885,356
Total assets	2,170,246	2,063,060
Debt, net (Notes 3, 8) (includes $4,600 and $5,112 at fair value)	2,149,259	2,044,950
Total liabilities	2,163,572	2,058,583
Held by consolidated trusts
Assets
Cash and cash equivalents (Notes 1, 3, 14) (includes $3,560 and $596 of restricted cash and cash equivalents)	3,495	567
Securities purchased under agreements to resell (Notes 3, 10)	21,400	12,125
Investments in securities, at fair value (Note 7)	766	0
Mortgage loans held-for-sale (Notes 3, 4) (includes $21,538 and $23,106 at fair value)	0	0
Mortgage loans held-for-investment (Notes 3, 4) (net of allowance for loan losses of $4,854 and $6,139)	1,905,633	1,842,850
Accrued interest receivable (Note 3)	6,109	5,914
Other assets (Notes 3, 18) (includes $4,590 and $3,929 at fair value)	12,093	1,631
Total assets	1,949,496	1,863,087
Liabilities
Accrued interest payable (Note 3)	5,519	5,335
Debt, net (Notes 3, 8) (includes $4,600 and $5,112 at fair value)	1,869,308	1,792,677
Total liabilities	1,874,827	1,798,012
Consolidated Balance Sheet Line Item
Mortgage loans held-for-investment (Notes 3, 4) (net of allowance for loan losses of $4,854 and $6,139)	1,905,633	1,842,850
All other assets	43,863	20,237
Total assets	1,949,496	1,863,087
Debt, net (Notes 3, 8) (includes $4,600 and $5,112 at fair value)	1,869,308	1,792,677
All other liabilities	5,519	5,335
Total liabilities	$ 1,874,827	$ 1,798,012

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Summary of Significant Accounting Policies

Freddie Mac is a GSE chartered by Congress in 1970. Our public mission is to provide liquidity, stability, and affordability to the U.S. housing market. We are regulated by FHFA, the SEC, HUD, and Treasury, and are currently operating under the conservatorship of FHFA. For more information on the roles of FHFA and Treasury, see Note 2 in this Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2018, or 2018 Annual Report. Throughout our unaudited condensed consolidated financial statements and related notes, we use certain acronyms and terms which are defined in the Glossary of our 2018 Annual Report. Throughout this Form 10-Q, we refer to the three months ended September 30, 2019, the three months ended June 30, 2019, the three months ended March 31, 2019, the three months ended December 31, 2018, the three months ended September 30, 2018, the three months ended June 30, 2018, the three months ended March 31, 2018, and the three months ended December 31, 2017 as "3Q 2019," "2Q 2019," "1Q 2019," "4Q 2018," "3Q 2018," "2Q 2018," "1Q 2018," and "4Q 2017," respectively. We refer to the nine months ended September 30, 2019 and the nine months ended September 30, 2018 as "YTD 2019" and "YTD 2018," respectively.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes in our 2018 Annual Report.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and include our accounts as well as the accounts of other entities in which we have a controlling financial interest. All intercompany balances and transactions have been eliminated.

We are operating under the basis that we will realize assets and satisfy liabilities in the normal course of business as a going concern and in accordance with the authority provided by FHFA to our Board of Directors to oversee management's conduct of our business operations. Certain amounts in prior periods' condensed consolidated financial statements have been reclassified to conform to the current presentation. In the opinion of management, our unaudited condensed consolidated financial statements contain all adjustments, which include only normal recurring adjustments, necessary for a fair statement of our results.

We evaluate the materiality of identified errors in the financial statements using both an income statement, or "rollover," and a balance sheet, or "iron curtain," approach, based on relevant quantitative and qualitative factors. Net income includes certain adjustments to correct immaterial errors related to previously reported periods.

Use of Estimates

The preparation of financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, gains, and losses during the reporting period. Management has made significant estimates in preparing the financial statements for establishing the allowance for credit losses and valuing financial instruments and other assets and liabilities. Actual results could be different from these estimates.

Recently Issued Accounting Guidance

Recently Adopted Accounting Guidance
Standard	Description	Date of Adoption	Effect on Condensed Consolidated Financial Statements
ASU 2016-02, Leases (Topic 842)	The amendment in this Update addresses the accounting for lease arrangements.	January 1, 2019	The adoption of the amendment did not have a material effect on our condensed consolidated financial statements or on our disclosures.
ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes	The amendments in this Update permit the OIS rate based on SOFR, as an eligible U.S. benchmark interest rate for purposes of applying hedge accounting under Topic 815.	January 1, 2019	The adoption of the amendment did not have a material effect on our condensed consolidated financial statements or on our disclosures.
ASU 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors	The amendments in this Update address certain ASU 2016-02 implementation issues including the recognition of taxes collected from lessees, lessor costs paid directly by a lessee, and recognition of variable payments for contracts with lease and non-lease components.	January 1, 2019	The adoption of the amendments did not have a material effect on our condensed consolidated financial statements or on our disclosures.

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Condensed Consolidated Financial Statements
Standard	Description	Date of Planned Adoption	Effect on Consolidated Financial Statements
ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this Update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects lifetime expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.	January 1, 2020	We have developed our models to estimate lifetime expected credit losses on our financial instruments measured at amortized cost primarily using a discounted cash flow methodology. We are using these models to execute our process for estimating the allowance for credit losses under the new standard in parallel with our existing process for estimating the allowance for credit losses under current GAAP and are developing an appropriate governance process for our estimate of expected credit losses under the new standard. The amendments will be applied through a cumulative effect adjustment to retained earnings as of the beginning of the year of adoption. While we continue to evaluate the effect that ASU 2016-13, Financial Instruments - Credit Losses, and related amendments will have on our consolidated financial statements, we expect the transition impact to result in an immaterial change in retained earnings. The increase in the allowance for credit losses from incorporating lifetime losses is generally offset by recoveries and a positive impact from including forecasts of economic conditions. The actual impact at adoption will depend upon the nature and characteristics of the portfolio at the adoption date, as well as macroeconomic conditions and forecasts at that time.
ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement	The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurements, based on the concepts in the Concepts Statement, including the consideration of costs and benefits. Certain disclosure requirements were either removed, modified, or added.	January 1, 2020	On October 1, 2018, we early adopted the amendments to remove or modify certain disclosures, which did not have a material effect on our consolidated financial statements. We are delaying adoption of the amendments to add certain disclosures until their effective date. We do not expect that the adoption of the additional disclosures will have a material effect on our consolidated financial statements.
ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract	The amendments in this Update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.
ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities	The amendments in this Update require that indirect interests held through related parties under common control be considered on a proportional basis when determining whether fees paid to decision makers or service providers are variable interests. These amendments align with the determination of whether a reporting entity within a related party group is the primary beneficiary of a VIE.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

Recently Issued Accounting Guidance, Not Yet Adopted Within Our Condensed Consolidated Financial Statements
Standard	Description	Date of Planned Adoption	Effect on Consolidated Financial Statements
ASU 2019-01, Leases (Topic 842): Narrow-Scope Improvements for Lessors	The amendments in this Update provide guidance for the: (1) lessor's fair value determination of the lease's underlying asset; (2) lessor's statement of cash flows presentation of cash received from sales-type and direct financing leases; and (3) removal of interim transition disclosure requirements related to changes in accounting principles.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.
ASU 2019-04, Codification Improvements to Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Financial Instruments (Topic 825)	The amendments in this Update clarify certain aspects of Topic 326 guidance issued in ASU 2016-13 including the scope of the credit losses standard and issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayments. The other amendments in this update clarify certain aspects of Topic 815 and Topic 825.	January 1, 2020	We are assessing the impact of adopting the Topic 326 amendments as part of our assessment of the adoption impact of ASU 2016-13, Financial Instruments-Credit Losses.  We do not expect that the adoption of the Topic 815 and Topic 825 amendments will have a material effect on our consolidated financial statements.
ASU 2019-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this Update provides entities with transition relief upon the adoption of ASU 2016-13 by providing an option to elect fair value option on certain financial instruments measured at amortized cost.	January 1, 2020	We do not expect that the adoption of these amendments will have a material effect on our consolidated financial statements.

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Debt Securities and Subordinated Borrowings - Other Debt (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Long-term Debt [Abstract]
Debt, net	$ 2,149,259	$ 2,044,950
Debt instrument recorded at fair value	4,600	5,112
Held by Freddie Mac
Short-term Debt [Abstract]
Other short-term debt par value	94,517	51,246
Other short-term debt carrying amount	$ 94,344	$ 51,080
Other short-term debt weighted average effective rate	2.20%	2.28%
Long-term Debt [Abstract]
Other long-term debt par value	$ 187,047	$ 203,724
Other long-term debt carrying amount	$ 185,607	$ 201,193
Other long-term debt weighted average effective rate	2.74%	2.58%
Total par value	$ 281,564	$ 254,970
Debt, net	279,951	252,273
Debt instrument recorded at fair value	3,900	4,400
Balance Net Of Callable Other Long Term Debt	105,500	107,200
Held by Freddie Mac | Other long-term debt | Other long-term debt - 2019
Long-term Debt [Abstract]
Other long-term debt par value	12,442	58,002
Other long-term debt carrying amount	$ 12,435	$ 57,968
Other long-term debt weighted average effective rate	1.63%	1.54%
Held by Freddie Mac | Other long-term debt | Other long-term debt - 2020
Long-term Debt [Abstract]
Other long-term debt par value	$ 48,348	$ 42,296
Other long-term debt carrying amount	$ 48,337	$ 42,275
Other long-term debt weighted average effective rate	2.00%	1.78%
Held by Freddie Mac | Other long-term debt | Other long-term debt - 2021
Long-term Debt [Abstract]
Other long-term debt par value	$ 36,669	$ 30,898
Other long-term debt carrying amount	$ 36,669	$ 30,901
Other long-term debt weighted average effective rate	2.05%	2.06%
Held by Freddie Mac | Other long-term debt | Other long-term debt - 2022
Long-term Debt [Abstract]
Other long-term debt par value	$ 26,044	$ 20,802
Other long-term debt carrying amount	$ 26,022	$ 20,775
Other long-term debt weighted average effective rate	2.34%	2.46%
Held by Freddie Mac | Other long-term debt | Other long-term debt - 2023
Long-term Debt [Abstract]
Other long-term debt par value	$ 10,064	$ 15,929
Other long-term debt carrying amount	$ 10,045	$ 15,906
Other long-term debt weighted average effective rate	2.65%	3.09%
Held by Freddie Mac | Other long-term debt | Other long-term debt - Thereafter
Long-term Debt [Abstract]
Other long-term debt par value	$ 37,392	$ 18,068
Other long-term debt carrying amount	$ 34,994	$ 15,579
Other long-term debt weighted average effective rate	3.68%	5.91%
Held by Freddie Mac | STACR and SCR debt
Long-term Debt [Abstract]
Other long-term debt par value	$ 16,088	$ 17,729
Other long-term debt carrying amount	$ 16,257	$ 18,004
Other long-term debt weighted average effective rate	6.03%	6.04%
Held by Freddie Mac | Hedging-Related Basis Adjustments
Long-term Debt [Abstract]
Other long-term debt carrying amount	$ 848	$ (215)
Held by Freddie Mac | Discount notes and Reference Bills
Short-term Debt [Abstract]
Other short-term debt par value	42,719	28,787
Other short-term debt carrying amount	$ 42,550	$ 28,621
Other short-term debt weighted average effective rate	2.09%	2.36%
Held by Freddie Mac | Medium-term notes
Short-term Debt [Abstract]
Other short-term debt par value	$ 43,098	$ 16,440
Other short-term debt carrying amount	$ 43,094	$ 16,440
Other short-term debt weighted average effective rate	2.34%	2.10%
Held by Freddie Mac | Securities Sold under Agreements to Repurchase
Short-term Debt [Abstract]
Other short-term debt par value	$ 8,700	$ 6,019
Other short-term debt carrying amount	$ 8,700	$ 6,019
Other short-term debt weighted average effective rate	2.06%	2.40%

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Fair Value Disclosures - Fair Value of Financial Instruments (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Financial Assets
Securities purchased under agreement to resell	$ 51,187	$ 34,771
Investments in Securities [Abstract]
Available-for-sale, at fair value	28,533	33,563
Mortgage Loans [Abstract]
Derivative Assets, net	1,592	335
Other Assets	4,590	3,929
Secured Lending and Other	5,439	1,805
Financial Liabilities
Debt, net	4,600	5,112
Derivative Liabilities, net	355	583
Other Liabilities	7,270	6,398
Held by consolidated trusts
Financial Assets
Securities purchased under agreement to resell	21,400	12,125
Financial Liabilities
Debt, net	737	755
Held by Freddie Mac
Financial Liabilities
Debt, net	3,900	4,400
GAAP Carrying Amount
Financial Assets
Cash and Cash Equivalents	8,708	7,273
Securities purchased under agreement to resell	51,187	34,771
Investments in Securities [Abstract]
Available-for-sale, at fair value	28,533	33,563
Trading, at fair value	44,449	35,548
Total investments in securities	72,982	69,111
Mortgage Loans [Abstract]
Mortgage loans	1,997,490	1,926,978
Derivative Assets, net	1,592	335
Guarantee Assets	4,225	3,633
Non Derivative Purchase Commitments Assets	223	159
Secured Lending and Other	5,439	1,805
Total Assets at Fair value	2,141,846	2,044,065
Financial Liabilities
Debt, net	2,149,259	2,044,950
Derivative Liabilities, net	355	583
Guarantee obligation	4,055	3,561
Non Derivative HFS Purchase Commitment Liabilities	1	17
Total Financial Liabilities	2,153,670	2,049,111
GAAP Carrying Amount | Held by consolidated trusts
Mortgage Loans [Abstract]
Mortgage loans	1,905,633	1,842,850
Financial Liabilities
Debt, net	1,869,308	1,792,677
GAAP Carrying Amount | Held by Freddie Mac
Mortgage Loans [Abstract]
Mortgage loans	91,857	84,128
Financial Liabilities
Debt, net	279,951	252,273
GAAP Carrying Amount | AmortizedCost
Mortgage Loans [Abstract]
Mortgage loans	2,000,000	1,900,000
Financial Liabilities
Debt, net	2,100,000	2,000,000
GAAP Carrying Amount | LowerOfCostOrFairValue
Mortgage Loans [Abstract]
Mortgage loans	19,600	18,500
GAAP Carrying Amount | FV - NI
Mortgage Loans [Abstract]
Mortgage loans	21,500	23,100
Financial Liabilities
Debt, net	4,600	5,100
Fair Value
Financial Assets
Cash and Cash Equivalents	8,708	7,273
Securities purchased under agreement to resell	51,187	34,771
Investments in Securities [Abstract]
Available-for-sale, at fair value	28,533	33,563
Trading, at fair value	44,449	35,548
Total investments in securities	72,982	69,111
Mortgage Loans [Abstract]
Mortgage loans	2,032,769	1,901,574
Derivative Assets, net	1,592	335
Netting Adjustment	(6,316)	(6,083)
Guarantee Assets	4,233	3,642
Non Derivative Purchase Commitments Assets	230	161
Secured Lending and Other	4,473	1,068
Total Assets at Fair value	2,176,174	2,017,935
Financial Liabilities
Debt, net	2,185,941	2,017,781
Derivative Liabilities, net	355	583
Netting Adjustment	(6,122)	(3,845)
Guarantee obligation	4,416	4,146
Non Derivative HFS Purchase Commitment Liabilities	13	28
Total Financial Liabilities	2,190,725	2,022,538
Fair Value | Held by consolidated trusts
Mortgage Loans [Abstract]
Mortgage loans	1,937,616	1,815,416
Financial Liabilities
Debt, net	1,900,955	1,762,609
Fair Value | Held by Freddie Mac
Mortgage Loans [Abstract]
Mortgage loans	95,153	86,158
Financial Liabilities
Debt, net	284,986	255,172
Fair Value | Level 1
Financial Assets
Cash and Cash Equivalents	8,693	7,273
Securities purchased under agreement to resell	0	0
Investments in Securities [Abstract]
Available-for-sale, at fair value	0	0
Trading, at fair value	21,952	15,885
Total investments in securities	21,952	15,885
Mortgage Loans [Abstract]
Mortgage loans	0	0
Derivative assets at fair value	0	0
Guarantee Assets	0	0
Non Derivative Purchase Commitments Assets	0	0
Secured Lending and Other	0	0
Total Assets at Fair value	30,645	23,158
Financial Liabilities
Debt, net	0	0
Derivative liabilities at fair value	0	0
Guarantee obligation	0	0
Non Derivative HFS Purchase Commitment Liabilities	0	0
Total Financial Liabilities	0	0
Fair Value | Level 1 | Held by consolidated trusts
Mortgage Loans [Abstract]
Mortgage loans	0	0
Financial Liabilities
Debt, net	0	0
Fair Value | Level 1 | Held by Freddie Mac
Mortgage Loans [Abstract]
Mortgage loans	0	0
Financial Liabilities
Debt, net	0	0
Fair Value | Level 2
Financial Assets
Cash and Cash Equivalents	15	0
Securities purchased under agreement to resell	51,187	34,771
Investments in Securities [Abstract]
Available-for-sale, at fair value	24,982	27,788
Trading, at fair value	19,561	16,369
Total investments in securities	44,543	44,157
Mortgage Loans [Abstract]
Mortgage loans	1,760,928	1,639,820
Derivative assets at fair value	7,892	6,417
Guarantee Assets	0	0
Non Derivative Purchase Commitments Assets	229	159
Secured Lending and Other	1,728	195
Total Assets at Fair value	1,866,522	1,725,519
Financial Liabilities
Debt, net	2,180,116	2,011,454
Derivative liabilities at fair value	6,437	4,336
Guarantee obligation	0	0
Non Derivative HFS Purchase Commitment Liabilities	1	17
Total Financial Liabilities	2,186,554	2,015,807
Fair Value | Level 2 | Held by consolidated trusts
Mortgage Loans [Abstract]
Mortgage loans	1,714,292	1,605,874
Financial Liabilities
Debt, net	1,898,887	1,759,911
Fair Value | Level 2 | Held by Freddie Mac
Mortgage Loans [Abstract]
Mortgage loans	46,636	33,946
Financial Liabilities
Debt, net	281,229	251,543
Fair Value | Level 3
Financial Assets
Cash and Cash Equivalents	0	0
Securities purchased under agreement to resell	0	0
Investments in Securities [Abstract]
Available-for-sale, at fair value	3,551	5,775
Trading, at fair value	2,936	3,294
Total investments in securities	6,487	9,069
Mortgage Loans [Abstract]
Mortgage loans	271,841	261,754
Derivative assets at fair value	16	1
Guarantee Assets	4,233	3,642
Non Derivative Purchase Commitments Assets	1	2
Secured Lending and Other	2,745	873
Total Assets at Fair value	285,323	275,341
Financial Liabilities
Debt, net	5,825	6,327
Derivative liabilities at fair value	40	92
Guarantee obligation	4,416	4,146
Non Derivative HFS Purchase Commitment Liabilities	12	11
Total Financial Liabilities	10,293	10,576
Fair Value | Level 3 | Held by consolidated trusts
Mortgage Loans [Abstract]
Mortgage loans	223,324	209,542
Financial Liabilities
Debt, net	2,068	2,698
Fair Value | Level 3 | Held by Freddie Mac
Mortgage Loans [Abstract]
Mortgage loans	48,517	52,212
Financial Liabilities
Debt, net	$ 3,757	$ 3,629

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Fair Value Disclosures - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Debt | Held by consolidated trusts
Liabilities:
Begining Balance	$ 733	$ 629	$ 728	$ 630
Included in Earnings	0	(1)	5	(2)
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized (gains) losses	0	(1)	5	(2)
Purchases	0	0	0	0
Issues	0	100	0	100
Sales	0	0	0	0
Settlements, Net	0	0	0	0
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	733	728	733	728
Unrealized (Gains) Losses Still Held - Liabilities	0	(1)	5	(2)
Debt | Held by Freddie Mac
Liabilities:
Begining Balance	129	135	134	137
Included in Earnings	0	0	0	0
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized (gains) losses	0	0	0	0
Purchases	2	0	0	0
Issues	0	0	2	0
Sales	0	0	0	0
Settlements, Net	(1)	(1)	(6)	(3)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	130	134	130	134
Unrealized (Gains) Losses Still Held - Liabilities	0	0	0	0
Net Derivatives
Net Derivative Liability
Beginning Balance	40	42	91	57
Included in Earnings	(8)	8	(54)	28
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized (gains) losses	(8)	8	(54)	28
Purchases	0	0	0	0
Issues	0	41	0	15
Sales	0	0	0	0
Settlements, Net	(8)	(4)	(13)	(13)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	24	87	24	87
Unrealized (Gains) Losses Still Held - Net Derivative Liability	(13)	3	(66)	15
All Other Liabilities
Liabilities:
Begining Balance	0		0
Included in Earnings	2		0
Included in Other Comprehensive Income	0		0
Total realized and unrealized (gains) losses	2		0
Purchases	2		4
Issues	0		0
Sales	(2)		(2)
Settlements, Net	0		0
Transfers into Level 3	0		0
Transfers out of Level 3	0		0
Ending Balance	2		2
Unrealized (Gains) Losses Still Held - Liabilities	0		(2)
Available-for-sale securities
Assets:
Beginning Balance	4,274	8,809	5,775	11,088
Included in Earnings	49	380	65	863
Included in Other Comprehensive Income	6	(134)	141	(806)
Total realized and unrealized gains (losses)	55	246	206	57
Purchases	0	684	202	684
Issues	0	0	0	0
Sales	(618)	(897)	(1,898)	(2,453)
Settlements, net	(160)	(335)	(471)	(1,188)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	(319)	(263)	0
Ending Balance	3,551	8,188	3,551	8,188
Unrealized Gains (Losses) Still Held - Assets	4	6	14	18
Available-for-sale securities | Freddie Mac
Assets:
Beginning Balance	2,744	6,004	4,097	6,751
Included in Earnings	23	(3)	13	(13)
Included in Other Comprehensive Income	16	(68)	115	(267)
Total realized and unrealized gains (losses)	39	(71)	128	(280)
Purchases	0	684	202	684
Issues	0	0	0	0
Sales	(531)	(237)	(1,724)	(293)
Settlements, net	(102)	(199)	(290)	(772)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	(91)	(263)	0
Ending Balance	2,150	6,090	2,150	6,090
Unrealized Gains (Losses) Still Held - Assets	1	(4)	2	(13)
Available-for-sale securities | Other agency
Assets:
Beginning Balance	36	270	38	46
Included in Earnings	0	0	0	0
Included in Other Comprehensive Income	0	0	1	(1)
Total realized and unrealized gains (losses)	0	0	1	(1)
Purchases	0	0	0	0
Issues	0	0	0	0
Sales	0	0	0	0
Settlements, net	(2)	(2)	(5)	(5)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	(228)	0	0
Ending Balance	34	40	34	40
Unrealized Gains (Losses) Still Held - Assets	0	0	0	0
Available-for-sale securities | Non-agency and other
Assets:
Beginning Balance	1,494	2,535	1,640	4,291
Included in Earnings	26	383	52	876
Included in Other Comprehensive Income	(10)	(66)	25	(538)
Total realized and unrealized gains (losses)	16	317	77	338
Purchases	0	0	0	0
Issues	0	0	0	0
Sales	(87)	(660)	(174)	(2,160)
Settlements, net	(56)	(134)	(176)	(411)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	1,367	2,058	1,367	2,058
Unrealized Gains (Losses) Still Held - Assets	3	10	12	31
Trading securities
Assets:
Beginning Balance	3,034	3,729	3,294	2,917
Included in Earnings	(30)	(141)	(113)	(385)
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	(30)	(141)	(113)	(385)
Purchases	287	623	1,242	1,057
Issues	0	0	0	0
Sales	(21)	(875)	(732)	(884)
Settlements, net	(35)	(30)	95	(54)
Transfers into Level 3	0	0	8	579
Transfers out of Level 3	(299)	(108)	(858)	(32)
Ending Balance	2,936	3,198	2,936	3,198
Unrealized Gains (Losses) Still Held - Assets	(31)	(137)	(69)	(364)
Trading securities | Freddie Mac
Assets:
Beginning Balance	3,028	3,711	3,286	2,907
Included in Earnings	(30)	(140)	(113)	(383)
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	(30)	(140)	(113)	(383)
Purchases	287	623	1,242	1,027
Issues	0	0	0	0
Sales	(21)	(875)	(730)	(863)
Settlements, net	(35)	(31)	95	(55)
Transfers into Level 3	0	0	8	579
Transfers out of Level 3	(299)	(108)	(858)	(32)
Ending Balance	2,930	3,180	2,930	3,180
Unrealized Gains (Losses) Still Held - Assets	(31)	(136)	(68)	(362)
Trading securities | Other agency
Assets:
Beginning Balance	5	17	7	9
Included in Earnings	0	(1)	0	(2)
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	0	(1)	0	(2)
Purchases	0	0	0	30
Issues	0	0	0	0
Sales	0	0	(2)	(21)
Settlements, net	0	1	0	1
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	5	17	5	17
Unrealized Gains (Losses) Still Held - Assets	0	(1)	(1)	(2)
Trading securities | All other
Assets:
Beginning Balance	1	1	1	1
Included in Earnings	0	0	0	0
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	0	0	0	0
Purchases	0	0	0	0
Issues	0	0	0	0
Sales	0	0	0	0
Settlements, net	0	0	0	0
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	1	1	1	1
Unrealized Gains (Losses) Still Held - Assets	0	0	0	0
Other Asset [Member]
Assets:
Beginning Balance	4,067	3,466	3,770	3,216
Included in Earnings	27	(27)	44	(17)
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	27	(27)	44	(17)
Purchases	24	(3)	75	38
Issues	451	244	1,034	721
Sales	(27)	0	(59)	0
Settlements, net	(175)	(147)	(497)	(425)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	4,367	3,533	4,367	3,533
Unrealized Gains (Losses) Still Held - Assets	12	(32)	24	(37)
All Other, at fair value
Assets:
Beginning Balance	126	103	137	45
Included in Earnings	12	1	(31)	31
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	12	1	(31)	31
Purchases	24	(3)	75	38
Issues	12	(11)	29	(24)
Sales	(27)	0	(59)	0
Settlements, net	(5)	0	(9)	0
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	142	90	142	90
Unrealized Gains (Losses) Still Held - Assets	(3)	(4)	(51)	11
Guarantee Asset
Assets:
Beginning Balance	3,941	3,363	3,633	3,171
Included in Earnings	15	(28)	75	(48)
Included in Other Comprehensive Income	0	0	0	0
Total realized and unrealized gains (losses)	15	(28)	75	(48)
Purchases	0	0	0	0
Issues	439	255	1,005	745
Sales	0	0	0	0
Settlements, net	(170)	(147)	(488)	(425)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Ending Balance	4,225	3,443	4,225	3,443
Unrealized Gains (Losses) Still Held - Assets	$ 15	$ (28)	$ 75	$ (48)

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Investments in Securities - Gross Realized Gains and Gross Realized Losses on Sales of Available-For-Sale Securities (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Investments, Debt and Equity Securities [Abstract]
Debt Securities, Available-for-sale, Realized Gain	$ 68	$ 69	$ 169	$ 544
Gross realized losses	(6)	(131)	(40)	(232)
Debt Securities, Available-for-sale, Realized Loss, Excluding Other-than-temporary Impairment	$ 62	$ (62)	$ 129	$ 312

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Investments in Securities - Investments in Securities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Investments, Debt and Equity Securities [Abstract]
Trading securities	$ 44,449	$ 35,548
Available-for-sale, at fair value	28,533	33,563
Total fair value of investments in securities	$ 72,982	$ 69,111

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Concentration of Credit and Other Risks - Seller Concentration (Details)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Top ten Single-family sellers | Single-family loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	56.00%	49.00%
JPMorgan Chase Bank, National Association | Single-family loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	16.00%	5.00%
Wells Fargo Bank, N.A. | Single-family loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	7.00%	12.00%
Other top 10 sellers | Single-family loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	33.00%	32.00%
Top ten multifamily sellers | Multifamily loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	79.00%	78.00%
CBRE Capital Markets, Inc. | Multifamily loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	16.00%	19.00%
Berkadia Commercial Mortgage LLC | Multifamily loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	15.00%	12.00%
Other top 10 sellers | Multifamily loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	48.00%	47.00%

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Securitization Activities and Consolidation - Non-Consolidated VIEs (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Assets [Abstract]
Investments in securities, at fair value	$ 72,982	$ 69,111
Accrued interest receivable	6,790	6,728
Derivative Assets, net	1,592	335
Other Assets	25,713	10,976
Liabilities [Abstract]
Derivative Liabilities, net	355	583
Other Liabilities	7,270	6,398
Variable Interest Entity, Not Primary Beneficiary
Assets [Abstract]
Investments in securities, at fair value	39,091	44,020
Accrued interest receivable	214	235
Derivative Assets, net	12	1
Other Assets	3,737	3,119
Liabilities [Abstract]
Derivative Liabilities, net	89	88
Other Liabilities	3,511	3,049
Maximum Exposure to Loss	268,269	241,055
Total Assets of Non-Consolidated VIEs	$ 320,221	$ 284,724

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Mortgage Loans and Loan Loss Reserves - Recorded Investment of Held-For-Investment Loans by Current LTV Ratio (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 1,961,226	$ 1,891,495
Single-Family serious delinquency rate	0.61%	0.69%
Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 1,648,880	$ 1,557,667
Single-family 15-year amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	240,892	255,831
Single-family Adjustable-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	39,325	44,007
Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	15,230	18,960
Single Family Loans
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 1,944,327	$ 1,876,465
Single-Family serious delinquency rate	0.61%	0.69%
Less Than Or Equal To 80 Estimated Current LTV Ratio | Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 1,388,311	$ 1,336,310
Less Than Or Equal To 80 Estimated Current LTV Ratio | Single-family 15-year amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	235,185	251,152
Less Than Or Equal To 80 Estimated Current LTV Ratio | Single-family Adjustable-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	37,659	42,117
Less Than Or Equal To 80 Estimated Current LTV Ratio | Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	13,743	16,498
Less Than Or Equal To 80 Estimated Current LTV Ratio | Single Family Loans
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	1,674,898	1,646,077
Greater Than 80 Through 100 Estimated Current LTV Ratio | Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	255,880	214,703
Greater Than 80 Through 100 Estimated Current LTV Ratio | Single-family 15-year amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	5,604	4,522
Greater Than 80 Through 100 Estimated Current LTV Ratio | Single-family Adjustable-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	1,660	1,883
Greater Than 80 Through 100 Estimated Current LTV Ratio | Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	1,198	1,903
Greater Than 80 Through 100 Estimated Current LTV Ratio | Single Family Loans
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	264,342	223,011
Greater Than 100 Estimated Current LTV Ratio | Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	4,689	6,654
Greater Than 100 Estimated Current LTV Ratio | Single-family 15-year amortizing fixed-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	103	157
Greater Than 100 Estimated Current LTV Ratio | Single-family Adjustable-rate
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	6	7
Greater Than 100 Estimated Current LTV Ratio | Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	289	559
Greater Than 100 Estimated Current LTV Ratio | Single Family Loans
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 5,087	$ 7,377
Single-Family serious delinquency rate	5.18%	7.24%

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Mortgage Loans and Loan Loss Reserves (Tables)

9 Months Ended

Sep. 30, 2019

SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract]

Table - Mortgage Loans

The table below provides details of the loans on our condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018.

Table 4.1 - Mortgage Loans

	September 30, 2019									December 31, 2018
(In millions)	Held by Freddie Mac			Held by Consolidated Trusts			Total			Held by Freddie Mac			Held by Consolidated Trusts			Total
Held-for-sale:
Single-family		$17,249			$—			$17,249			$20,946			$—			$20,946
Multifamily	25,397			—			25,397			23,959			—			23,959
Total UPB	42,646			—			42,646			44,905			—			44,905
Cost basis and fair value adjustments, net	(1,528		)	—			(1,528		)	(3,283		)	—			(3,283		)
Total held-for-sale loans, net	41,118			—			41,118			41,622			—			41,622
Held-for-investment:
Single-family	41,886			1,867,906			1,909,792			35,885			1,814,008			1,849,893
Multifamily	11,291			5,591			16,882			10,828			4,220			15,048
Total UPB	53,177			1,873,497			1,926,674			46,713			1,818,228			1,864,941
Cost basis adjustments	(421		)	34,973			34,552			(1,198		)	27,752			26,554
Allowance for loan losses	(2,017		)	(2,837		)	(4,854		)	(3,009		)	(3,130		)	(6,139		)
Total held-for-investment loans, net	50,739			1,905,633			1,956,372			42,506			1,842,850			1,885,356
Total mortgage loans, net		$91,857			$1,905,633			$1,997,490			$84,128			$1,842,850			$1,926,978

The table below provides details of the UPB of loans we purchased, reclassified from held-for-investment to held-for-sale, and sold.

Table 4.2 - Loans Purchased, Reclassified from Held-for-Investment to Held-for-Sale, and Sold

(In billions)	3Q 2019		3Q 2018		YTD 2019		YTD 2018
Single-family:
Purchases
Held-for-investment loans		$133.8		$81.6		$305.0		$231.5
Reclassified from held-for-investment to held-for-sale (1)	3.0		13.3		8.1		17.6
Sale of held-for-sale loans(2)	3.7		2.3		9.4		6.5
Multifamily:
Purchases
Held-for-investment loans	4.4		0.9		6.8		2.6
Held-for-sale loans	23.1		16.3		50.6		42.5
Reclassified from held-for-investment to held-for-sale (1)	0.4		0.2		1.2		0.7
Sale of held-for-sale loans (3)	19.7		14.4		49.5		44.8

(1) We reclassify loans from held-for-investment to held-for-sale when we no longer have the intent or ability to hold for the foreseeable future. For additional information regarding the fair value of our loans classified as held-for-sale, see Note 15.

(2) Our sales of single-family loans reflect the sale of seasoned single-family mortgage loans. The sale of seasoned single-family mortgage loans is part of our strategy to mitigate and reduce our holdings of less liquid assets.

(3)

Our sales of multifamily loans occur primarily through the issuance of multifamily K Certificates and SB Certificates.

Table - Recorded Investment of Held-For-Investment Mortgage Loans, by LTV Ratio and Credit Quality Indicator

The table below presents the recorded investment of single-family held-for-investment loans by current LTV ratios. Our current LTV ratios are estimates based on available data through the end of each respective period presented.

Table 4.3 - Recorded Investment of Single-Family Held-for-Investment Loans by Current LTV Ratios

	September 30, 2019								December 31, 2018
	Current LTV Ratio						Total		Current LTV Ratio						Total
(In millions)	≤ 80		> 80 to 100		> 100(1)				≤ 80		> 80 to 100		> 100(1)
20- and 30-year or more, amortizing fixed-rate		$1,388,311		$255,880		$4,689		$1,648,880		$1,336,310		$214,703		$6,654		$1,557,667
15-year amortizing fixed-rate	235,185		5,604		103		240,892		251,152		4,522		157		255,831
Adjustable-rate	37,659		1,660		6		39,325		42,117		1,883		7		44,007
Alt-A, interest-only, and option ARM	13,743		1,198		289		15,230		16,498		1,903		559		18,960
Total single-family loans		$1,674,898		$264,342		$5,087		$1,944,327		$1,646,077		$223,011		$7,377		$1,876,465

(1) The serious delinquency rate for the total of single-family held-for-investment mortgage loans with current LTV ratios in excess of 100% was 5.18% and 7.24% as of September 30, 2019 and December 31, 2018, respectively.

The table below presents the recorded investment in our multifamily held-for-investment loans, by credit quality indicator based on available data through the end of each period presented. These indicators involve significant management judgment.

Table 4.4 - Recorded Investment of Multifamily Held-for-Investment Loans by Credit Quality Indicator

(In millions)	September 30, 2019		December 31, 2018
Credit risk profile by internally assigned grade:(1)
Pass		$16,684		$14,648
Special mention	66		201
Substandard	149		181
Doubtful	—		—
Total		$16,899		$15,030

(1)

A loan categorized as: "Pass" is current and adequately protected by the current financial strength and debt service capacity of the borrower; "Special mention" has administrative issues that may affect future repayment prospects but does not have current credit weaknesses; "Substandard" has a weakness that jeopardizes the timely full repayment; and "Doubtful" has a weakness that makes collection or liquidation in full highly questionable and improbable based on existing conditions.

Table - Payment Status of Mortgage Loans

The tables below present the recorded investment of our single-family and multifamily loans, held-for-investment, by payment status.

Table 4.5 - Recorded Investment of Held-for-Investment Loans by Payment Status

	September 30, 2019
(In millions)	Current		One Month Past Due		Two Months Past Due		Three Months or More Past Due, or in Foreclosure(1)		Total		Non-accrual
Single-family:
20- and 30-year or more, amortizing fixed-rate		$1,624,964		$14,846		$3,495		$5,575		$1,648,880		$5,573
15-year amortizing fixed-rate	239,460		1,025		170		237		240,892		237
Adjustable-rate	38,928		249		53		95		39,325		95
Alt-A, interest-only, and option ARM	13,855		608		228		539		15,230		538
Total single-family	1,917,207		16,728		3,946		6,446		1,944,327		6,443
Total multifamily	16,896		3		—		—		16,899		13
Total single-family and multifamily		$1,934,103		$16,731		$3,946		$6,446		$1,961,226		$6,456
	December 31, 2018
(In millions)	Current		One Month Past Due		Two Months Past Due		Three Months or More Past Due, or in Foreclosure(1)		Total		Non-accrual
Single-family:
20- and 30-year or more, amortizing fixed-rate		$1,532,499		$14,683		$3,602		$6,883		$1,557,667		$6,881
15-year amortizing fixed-rate	254,376		1,021		171		263		255,831		263
Adjustable-rate	43,549		287		58		113		44,007		113
Alt-A, interest-only, and option ARM	16,975		793		327		865		18,960		864
Total single-family	1,847,399		16,784		4,158		8,124		1,876,465		8,121
Total multifamily	15,030		—		—		—		15,030		17
Total single-family and multifamily		$1,862,429		$16,784		$4,158		$8,124		$1,891,495		$8,138

(1)

Includes $1.9 billion and $2.9 billion of single-family loans that were in the process of foreclosure as of September 30, 2019 and December 31, 2018, respectively.

Table - Delinquency Rates

The table below summarizes the delinquency rates of loans within our single-family credit guarantee and multifamily mortgage portfolios.

Table 4.6 - Delinquency Rates

(Dollars in millions)	September 30, 2019			December 31, 2018
Single-family:
Non-credit-enhanced portfolio
Serious delinquency rate	0.72		%	0.83		%
Total number of seriously delinquent loans	42,758			51,197
Credit-enhanced portfolio:(1)
Primary mortgage insurance:
Serious delinquency rate	0.76		%	0.86		%
Total number of seriously delinquent loans	14,358			15,287
Other credit protection:(2)
Serious delinquency rate	0.34		%	0.31		%
Total number of seriously delinquent loans	15,736			12,920
Total single-family:
Serious delinquency rate	0.61		%	0.69		%
Total number of seriously delinquent loans	67,991			75,649
Multifamily: (3)
Non-credit-enhanced portfolio:
Delinquency rate	0.01		%	—		%
UPB of delinquent loans		$3			$2
Credit-enhanced portfolio:
Delinquency rate	0.04		%	0.01		%
UPB of delinquent loans		$103			$28
Total multifamily:
Delinquency rate	0.04		%	0.01		%
UPB of delinquent loans		$106			$30

(1) The credit-enhanced categories are not mutually exclusive, as a single loan may be covered by both primary mortgage insurance and other credit protection.

(2) Consists of single-family loans covered by financial arrangements (other than primary mortgage insurance) that are designed to reduce our credit risk exposure. See Note 6 for additional information on our credit enhancements.

(3)

Multifamily delinquency performance is based on the UPB of loans that are two monthly payments or more past due or those in the process of foreclosure.

Table - Detail of Allowance for Credit Losses

Table 4.7 - Details of Allowance for Credit Losses

The table below summarizes changes in our allowance for credit losses.

	3Q 2019												3Q 2018
	Allowance for Loan Losses						Reserve  for Guarantee Losses			Total			Allowance for Loan Losses						Reserve  for Guarantee Losses			Total
(In millions)	Held by Freddie Mac			Held By Consolidated Trusts									Held by Freddie Mac			Held By Consolidated Trusts
Single-family:
Beginning balance		$2,238			$3,042			$46			$5,326			$4,887			$3,497			$49			$8,433
Provision (benefit) for credit losses	(84		)	(97		)	1			(180		)	(522		)	143			1			(378		)
Charge-offs	(394		)	(12		)	(1		)	(407		)	(1,262		)	(13		)	(2		)	(1,277		)
Recoveries	104			3			—			107			117			2			—			119
Transfers, net (1)	103			(103		)	—			—			306			(306		)	—			—
Other (2)	41			—			—			41			76			11			—			87
Single-family ending balance	2,008			2,833			46			4,887			3,602			3,334			48			6,984
Multifamily ending balance	9			4			5			18			8			2			8			18
Total ending balance		$2,017			$2,837			$51			$4,905			$3,610			$3,336			$56			$7,002

	YTD 2019												YTD 2018
	Allowance for Loan Losses						Reserve  for Guarantee Losses			Total			Allowance for Loan Losses						Reserve  for Guarantee Losses			Total
(In millions)	Held by Freddie Mac			Held By Consolidated Trusts									Held by Freddie Mac			Held By Consolidated Trusts
Single-family:
Beginning balance		$3,003			$3,127			$46			$6,176			$5,251			$3,680			$48			$8,979
Provision (benefit) for credit losses	(509		)	29			3			(477		)	(629		)	266			6			(357		)
Charge-offs	(1,208		)	(45		)	(3		)	(1,256		)	(2,198		)	(44		)	(6		)	(2,248		)
Recoveries	331			10			—			341			336			5			—			341
Transfers, net (1)	291			(291		)	—			—			597			(597		)	—			—
Other (2)	100			3			—			103			245			24			—			269
Single-family ending balance	2,008			2,833			46			4,887			3,602			3,334			48			6,984
Multifamily ending balance	9			4			5			18			8			2			8			18
Total ending balance		$2,017			$2,837			$51			$4,905			$3,610			$3,336			$56			$7,002

(1) Relates to removal of delinquent loans from consolidated trusts and resecuritization after such removal. 

(2)

Primarily includes capitalization of past due interest on modified loans.

Table - Net Investment in Loans

The table below presents our allowance for loan losses and our recorded investment in loans, held-for-investment, by impairment evaluation methodology.

Table 4.8 - Net Investment in Loans

	September 30, 2019									December 31, 2018
(In millions)	Single-family			Multifamily			Total			Single-family			Multifamily			Total
Recorded investment:
Collectively evaluated		$1,904,203			$16,818			$1,921,021			$1,830,044			$14,945			$1,844,989
Individually evaluated	40,124			81			40,205			46,421			85			46,506
Total recorded investment	1,944,327			16,899			1,961,226			1,876,465			15,030			1,891,495
Ending balance of the allowance for loan losses:
Collectively evaluated	(1,515		)	(13		)	(1,528		)	(1,761		)	(9		)	(1,770		)
Individually evaluated	(3,326		)	—			(3,326		)	(4,369		)	—			(4,369		)
Total ending balance of the allowance	(4,841		)	(13		)	(4,854		)	(6,130		)	(9		)	(6,139		)
Net investment in loans		$1,939,486			$16,886			$1,956,372			$1,870,335			$15,021			$1,885,356

Table - Individually Impaired Loans

The tables below present the UPB, recorded investment, related allowance for loan losses, average recorded investment, and interest income recognized for individually impaired loans.

Table 4.9 - Individually Impaired Loans

	September 30, 2019							December 31, 2018
(In millions)	UPB		Recorded Investment		Associated Allowance			UPB		Recorded Investment		Associated Allowance
Single-family:
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$3,008		$2,390	N/A				$3,335		$2,666	N/A
15-year amortizing fixed-rate	20		20		N/A			23		22		N/A
Adjustable-rate	183		182		N/A			227		226		N/A
Alt-A, interest-only, and option ARM	1,004		853		N/A			1,286		1,083		N/A
Total with no allowance recorded	4,215		3,445		N/A			4,871		3,997		N/A
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	32,441		32,118			($2,784	)	37,579		36,959			($3,660	)
15-year amortizing fixed-rate	641		650		(14		)	703		713		(19		)
Adjustable-rate	133		132		(7		)	164		162		(8		)
Alt-A, interest-only, and option ARM	3,962		3,779		(521		)	4,867		4,590		(682		)
Total with an allowance recorded	37,177		36,679		(3,326		)	43,313		42,424		(4,369		)
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	35,449		34,508		(2,784		)	40,914		39,625		(3,660		)
15-year amortizing fixed-rate	661		670		(14		)	726		735		(19		)
Adjustable-rate	316		314		(7		)	391		388		(8		)
Alt-A, interest-only, and option ARM	4,966		4,632		(521		)	6,153		5,673		(682		)
Total single-family	41,392		40,124		(3,326		)	48,184		46,421		(4,369		)
Multifamily:
With no allowance recorded (1)	87		81		N/A			89		82		N/A
With an allowance recorded	—		—		—			3		3		—
Total multifamily	87		81		—			92		85		—
Total single-family and multifamily		$41,479		$40,205		($3,326	)		$48,276		$46,506		($4,369	)

Referenced footnotes are included after the last table in the Impaired Loans section.

	3Q 2019						3Q 2018
(In millions)	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)
Single-family:
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$2,450		$59		$1		$3,142		$83		$3
15-year amortizing fixed-rate	19		1		—		20		—		—
Adjustable rate	191		3		—		238		3		—
Alt-A, interest-only, and option ARM	880		16		—		1,159		21		1
Total with no allowance recorded	3,540		79		1		4,559		107		4
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	32,618		412		47		42,393		520		52
15-year amortizing fixed-rate	641		5		1		740		7		2
Adjustable rate	129		2		—		183		2		—
Alt-A, interest-only, and option ARM	3,866		55		9		5,622		72		7
Total with an allowance recorded	37,254		474		57		48,938		601		61
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	35,068		471		48		45,535		603		55
15-year amortizing fixed-rate	660		6		1		760		7		2
Adjustable rate	320		5		—		421		5		—
Alt-A, interest-only, and option ARM	4,746		71		9		6,781		93		8
Total single-family	40,794		553		58		53,497		708		65
Multifamily:
With no allowance recorded (1)	81		1		1		112		2		1
With an allowance recorded	—		—		—		3		—		—
Total multifamily	81		1		1		115		2		1
Total single-family and multifamily		$40,875		$554		$59		$53,612		$710		$66

Referenced footnotes are included after the last table in the Impaired Loans section

	YTD 2019						YTD 2018
(In millions)	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)
Single-family —
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$2,573		$207		$6		$3,399		$268		$13
15-year amortizing fixed-rate	20		1		—		21		3		—
Adjustable rate	209		9		—		255		9		—
Alt-A, interest-only, and option ARM	932		52		1		1,319		68		3
Total with no allowance recorded	3,734		269		7		4,994		348		16
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	34,051		1,394		138		46,140		1,621		217
15-year amortizing fixed-rate	665		17		3		830		21		8
Adjustable rate	139		5		1		210		4		2
Alt-A, interest-only, and option ARM	4,097		180		18		6,357		205		24
Total with an allowance recorded	38,952		1,596		160		53,537		1,851		251
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	36,624		1,601		144		49,539		1,889		230
15-year amortizing fixed-rate	685		18		3		851		24		8
Adjustable rate	348		14		1		465		13		2
Alt-A, interest-only, and option ARM	5,029		232		19		7,676		273		27
Total single-family	42,686		1,865		167		58,531		2,199		267
Multifamily:
With no allowance recorded (1)	83		3		1		132		5		2
With an allowance recorded	—		—		—		3		—		—
Total multifamily	83		3		1		135		5		2
Total single-family and multifamily		$42,769		$1,868		$168		$58,666		$2,204		$269

(1) Individually impaired loans with no allowance primarily represent those loans for which the collateral value is sufficiently in excess of the loan balance to result in recovery of the entire recorded investment if the property were foreclosed upon or otherwise subject to disposition.

(2) Consists primarily of loans classified as TDRs.

(3)

Consists of income recognized during the period related to loans on non-accrual status.

Table - TDR Activity

The table below presents the volume of single-family and multifamily loans that were newly classified as TDRs, based on the original product category of the loan before the loan was classified as a TDR. Loans classified as a TDR in one period may be subject to further action (such as a modification or remodification) in a subsequent period. In such cases, the subsequent action would not be reflected in the table below since the loan would already have been classified as a TDR.

Table 4.10 - TDR Activity

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(Dollars in millions)	Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment
Single-family: (1)
20- and 30-year or more, amortizing fixed-rate	5,908		$998	7,157		$1,091	19,668		$3,262	37,847		$6,159
15-year amortizing fixed-rate	693	69		909	83		2,364	230		5,194	514
Adjustable-rate	128	22		197	27		403	64		773	122
Alt-A, interest-only, and option ARM	285	45		414	65		1,331	190		2,294	379
Total single-family	7,014	1,134		8,677	1,266		23,766	3,746		46,108	7,174
Multifamily	—		$—	—		$—	—		$—	1		$15

(1)

The pre-TDR recorded investment for single-family loans initially classified as TDR during 3Q 2019 and YTD 2019 was $1.1 billion and $3.7 billion, respectively, compared to $1.3 billion and $7.2 billion during 3Q 2018 and YTD 2018, respectively.

Table - Payment Defaults of Completed TDR Modifications

The table below presents the volume of our TDR modifications that experienced payment defaults (i.e., loans that became two months delinquent or completed a loss event) during the applicable periods and had completed a modification during the year preceding the payment default. The table presents loans based on their original product category before modification.

Table 4.11 - Payment Defaults of Completed TDR Modifications

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(Dollars in millions)	Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment
Single-family:
20- and 30-year or more, amortizing fixed-rate	3,256		$407	3,584		$512	10,533		$1,237	9,671		$1,435
15-year amortizing fixed-rate	96	9		116	10		329	24		435	36
Adjustable-rate	33	3		53	9		95	10		139	21
Alt-A, interest-only, and option ARM	178	24		302	55		687	96		827	154
Total single-family	3,563	443		4,055	586		11,644	1,367		11,072	1,646
Multifamily	—		$—	—		$—	—		$—	—		$—

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Regulatory Capital

9 Months Ended

Sep. 30, 2019

Mortgage Banking [Abstract]

REGULATORY CAPITAL

Regulatory Capital

In October 2008, FHFA announced that it was suspending capital classification of us during conservatorship in light of the Purchase Agreement. FHFA continues to monitor our capital levels, but the existing statutory and FHFA regulatory capital requirements are not binding during conservatorship.

We continue to provide quarterly submissions to FHFA on minimum capital. The table below summarizes our minimum capital requirements and deficits and net worth.

Table 17.1 - Net Worth and Minimum Capital

(In millions)	September 30, 2019			December 31, 2018
GAAP net worth (deficit)		$6,674			$4,477
Core capital (deficit)(1)(2)	(66,556		)	(68,036		)
Less: Minimum capital requirement(1)	18,817			17,553
Minimum capital surplus (deficit)(1)		($85,373	)		($85,589	)

(1) Core capital and minimum capital figures are estimates and represent amounts submitted to FHFA. FHFA is the authoritative source for our regulatory capital.

(2) Core capital excludes certain components of GAAP total equity (i.e., AOCI and the liquidation preference of the senior preferred stock) as these items do not meet the statutory definition of core capital.

In May 2017, FHFA, as Conservator, issued guidance to us to evaluate and manage our financial risk and to make economic business decisions, while in conservatorship, utilizing a newly-developed risk-based CCF, an economic capital system with detailed formulae provided by FHFA. We use the CCF to measure risk for making economically effective decisions. We are required to submit quarterly reports to FHFA related to the CCF requirements.

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Legal Contingencies (Details) $ in Millions	Mar. 14, 2013 numberofdefendants	Sep. 20, 2013 USD ($)
LIBOR Lawsuit
Loss Contingencies [Line Items]
Number of defendants | numberofdefendants	16
Arrowood lawsuit | Arrowood Indemnity Company
Loss Contingencies [Line Items]
Preferred Stock, Value, Outstanding | $		$ 42

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Derivatives (Tables)

9 Months Ended

Sep. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Table - Derivative Assets and Liabilities at Fair Value

The table below presents the notional value and fair value of derivatives reported on our condensed consolidated balance sheets.

Table 9.1 - Derivative Assets and Liabilities at Fair Value

	September 30, 2019								December 31, 2018
	Notional or Contractual Amount		Derivatives at Fair Value						Notional or Contractual Amount		Derivatives at Fair Value
(In millions)			Assets			Liabilities					Assets			Liabilities
Not designated as hedges
Interest-rate swaps:
Receive-fixed		$217,377		$2,346			($10	)		$145,386		$1,380			($181	)
Pay-fixed	246,557		6			(4,381		)	170,899		476			(2,287		)
Basis (floating to floating)	5,924		—			—			5,404		1			—
Total interest-rate swaps	469,858		2,352			(4,391		)	321,689		1,857			(2,468		)
Option-based:
Call swaptions
Purchased	61,275		3,963			—			43,625		2,007			—
Written	2,500		—			(37		)	4,400		—			(133		)
Put swaptions
Purchased(1)	63,600		512			—			88,075		1,565			—
Written	8,700		—			(41		)	1,750		—			(4		)
Other option-based derivatives(2)	10,368		721			—			10,481		628			—
Total option-based	146,443		5,196			(78		)	148,331		4,200			(137		)
Futures	181,479		—			—			161,185		—			—
Commitments	152,300		195			(171		)	36,044		90			(179		)
Credit derivatives	1,822		1			(23		)	2,030		—			(35		)
Other	16,991		12			(103		)	12,212		1			(103		)
Total derivatives not designated as hedges	968,893		7,756			(4,766		)	681,491		6,148			(2,922		)
Designated as fair value hedges
Interest-rate swaps:
Receive-fixed	113,425		145			(91		)	117,038		23			(935		)
Pay-fixed	78,966		7			(1,620		)	77,513		247			(571		)
Total derivatives designated as fair value hedges	192,391		152			(1,711		)	194,551		270			(1,506		)
Derivative interest and other receivable (payable)			912			(872		)			889			(1,096		)
Netting adjustments(3)			(7,228		)	6,994					(6,972		)	4,941
Total derivative portfolio, net		$1,161,284		$1,592			($355	)		$876,042		$335			($583	)

(1) Includes swaptions on credit indices with a notional or contractual amount of $17.3 billion and $45.9 billion at September 30, 2019 and December 31, 2018, respectively, and a fair value of $6.0 million and $113.0 million at September 30, 2019 and December 31, 2018, respectively.

(2) Primarily consists of purchased interest-rate caps and floors.

(3) Represents counterparty netting and cash collateral netting.

Table - Gains and Losses on Derivatives

The table below presents the gains and losses on derivatives, including the accrual of periodic cash settlements, while not designated in qualifying hedge relationships and reported on our condensed consolidated statements of comprehensive income as derivative gains (losses).

Table 9.2 - Gains and Losses on Derivatives

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Not designated as hedges
Interest-rate swaps:
Receive-fixed		$2,060			($1,004	)		$7,580			($5,080	)
Pay-fixed	(3,866		)	1,721			(12,152		)	7,922
Basis (floating to floating)	(3		)	19			7			(9		)
Total interest-rate swaps	(1,809		)	736			(4,565		)	2,833
Option-based:
Call swaptions
Purchased	1,398			(402		)	2,981			(1,392		)
Written	(109		)	35			(343		)	76
Put swaptions
Purchased	(355		)	136			(1,406		)	524
Written	19			(2		)	83			(23		)
Other option-based derivatives(1)	(6		)	(73		)	93			(205		)
Total option-based	947			(306		)	1,408			(1,020		)
Other:
Futures	(262		)	277			(1,283		)	728
Commitments	(54		)	69			(366		)	672
Credit derivatives	6			(4		)	1			(14		)
Other	2			(71		)	36			(64		)
Total other	(308		)	271			(1,612		)	1,322
Accrual of periodic cash settlements:
Receive-fixed interest-rate swaps	39			39			(32		)	335
Pay-fixed interest-rate swaps	(126		)	(50		)	(220		)	(536		)
Other	40			38			109			40
Total accrual of periodic cash settlements	(47		)	27			(143		)	(161		)
Total		($1,217	)		$728			($4,912	)		$2,974

(1)

Primarily consists of purchased interest-rate caps and floors.

Table - Gains and Losses on Fair Value Hedge

The tables below present the effects of fair value hedge accounting by condensed consolidated statements of comprehensive income line, including the gains and losses on derivatives and hedged items designated in qualifying hedge relationships and other components due to the application of hedge accounting.

Table 9.3 - Gains and Losses on Fair Value Hedges

	3Q 2019						3Q 2018
(In millions)	Interest Income - Mortgage Loans			Interest Expense			Interest Income - Mortgage Loans			Interest Expense
Total amounts of income and expense line items presented in our condensed consolidated statements of comprehensive income in which the effects of fair value hedges are recorded:		$16,428			($15,130	)		$16,787			($14,546	)
Interest contracts on mortgage loans held-for-investment:
Gain (loss) on fair value hedging relationships:
Hedged items	1,298			—			(755		)	—
Derivatives designated as hedging instruments	(1,588		)	—			776			—
Interest accruals on hedging instruments	(48		)	—			(96		)	—
Discontinued hedge-related basis adjustments amortization	(210		)	—			38			—
Interest contracts on debt:
Gain (loss) on fair value hedging relationships:
Hedged items	—			(36		)	—			121
Derivatives designated as hedging instruments	—			91			—			(50		)
Interest accruals on hedging instruments	—			(18		)	—			(96		)
Discontinued hedge-related basis adjustments amortization	—			18			—			(1		)

	YTD 2019						YTD 2018
(In millions)	Interest Income - Mortgage Loans			Interest Expense			Interest Income - Mortgage Loans			Interest Expense
Total amounts of income and expense line items presented in our condensed consolidated statements of comprehensive income in which the effects of fair value hedges are recorded:		$51,732			($46,498	)		$49,082			($42,802	)
Interest contracts on mortgage loans held-for-investment:
Gain (loss) on fair value hedging relationships:
Hedged items	5,691			—			(3,441		)	—
Derivatives designated as hedging instruments	(5,609		)	—			3,087			—
Interest accruals on hedging instruments	(4		)	—			(373		)	—
Discontinued hedge-related basis adjustments amortization	(229		)	—			86			—
Interest contracts on debt:
Gain (loss) on fair value hedging relationships:
Hedged items	—			(1,141		)	—			931
Derivatives designated as hedging instruments	—			1,288			—			(728		)
Interest accruals on hedging instruments	—			(230		)	—			(219		)
Discontinued hedge-related basis adjustments amortization	—			43			—			(2		)

Cumulative Basis Adjustment on Fair Value Hedge [Table Text Block]

The tables below present the hedged item cumulative basis adjustments due to qualifying fair value hedging and the related hedged item carrying amounts by their respective balance sheet line item.

Table 9.4 - Cumulative Basis Adjustments Due to Fair Value Hedging

	September 30, 2019
	Carrying Amount Assets / (Liabilities)			Cumulative Amount of Fair Value Hedging Basis Adjustment Included in the Carrying Amount									Closed Portfolio Under the Last-of-Layer Method
(In millions)				Total			Under the Last-of-Layer Method			Discontinued - Hedge Related			Total Amount by Amortized Cost Basis		Designated Amount by UPB
Mortgage loans held-for-investment		$470,584			$4,225			($379	)		$4,604			$266,975		$20,472
Debt	(130,653		)	(848		)	—			(114		)	—		—
	December 31, 2018
	Carrying Amount Assets / (Liabilities)			Cumulative Amount of Fair Value Hedging Basis Adjustment Included in the Carrying Amount									Closed Portfolio Under the Last-of-Later Method
(In millions)				Total			Under the Last-of-Layer Method			Discontinued - Hedge Related			Total Amount by Amortized Cost Basis		Designated Amount by UPB
Mortgage loans held-for-investment		$193,547			($1,237	)		$—			($1,237	)		$—		$—
Debt	(127,215		)	216			—			(8		)	—		—

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Concentration of Credit and Other Risks (Tables)

9 Months Ended

Sep. 30, 2019

Risks and Uncertainties [Abstract]

Table - Concentration of Credit Risk

The table below summarizes the concentration by loan portfolio and geographic area of the approximately $2.0 trillion and $1.9 trillion UPB of our single-family credit guarantee portfolio as of September 30, 2019 and December 31, 2018, respectively. See Note 4 and Note 7 for more information about credit risk associated with loans and mortgage-related securities that we hold or guarantee.

Table 14.1 - Concentration of Credit Risk of Our Single-Family Credit Guarantee Portfolio

	September 30, 2019				December 31, 2018				Percent of Credit Losses
	Percentage  of Portfolio		Serious Delinquency Rate		Percentage  of Portfolio		Serious Delinquency Rate		YTD 2019		YTD 2018
Core single-family loan portfolio	84	%	0.24	%	82	%	0.22	%	16	%	12	%
Legacy and relief refinance single-family loan portfolio	16		1.77		18		1.93		84		88
Total	100	%	0.61		100	%	0.69		100	%	100	%
Region(1)
West	30	%	0.35		30	%	0.38		12	%	17	%
Northeast	24		0.86		24		0.96		40		40
North Central	16		0.60		16		0.63		19		18
Southeast	16		0.72		16		0.90		22		18
Southwest	14		0.51		14		0.57		7		7
Total	100	%	0.61		100	%	0.69		100	%	100	%
State(2)
Florida	6	%	0.75		6	%	1.01		14	%	10	%
New York	5		1.20		5		1.37		12		12
New Jersey	3		1.07		3		1.24		10		10
Illinois	4		0.82		5		0.86		10		9
California	18		0.33		18		0.35		7		10
All other	64		0.57		63		0.64		47		49
Total	100	%	0.61	%	100	%	0.69	%	100	%	100	%

(1) Region designation: West (AK, AZ, CA, GU, HI, ID, MT, NV, OR, UT, WA); Northeast (CT, DE, DC, MA, ME, MD, NH, NJ, NY, PA, RI, VT, VA, WV); North Central (IL, IN, IA, MI, MN, ND, OH, SD, WI); Southeast (AL, FL, GA, KY, MS, NC, PR, SC, TN, VI); Southwest (AR, CO, KS, LA, MO, NE, NM, OK, TX, WY).

(2)

States presented based on those with the highest percentage of credit losses during YTD 2019.

The table below summarizes the concentration of mortgage insurer counterparties who provided 10% or more of our overall mortgage insurance coverage. On October 23, 2016, Genworth Financial, Inc. announced that it had entered into an agreement to be acquired by China Oceanwide Holdings Group Co., Ltd. Because Genworth Mortgage Insurance Corporation, a subsidiary of Genworth Financial, Inc., is an approved mortgage insurer, Freddie Mac has evaluated the planned acquisition and approved China Oceanwide Holdings Group's control of Genworth Mortgage Insurance Corporation. Regulatory and other approvals of the acquisition are still pending.

Table 14.5 - Mortgage Insurer Concentration

		Mortgage Insurance Coverage(2)
Mortgage Insurer	Credit Rating(1)	September 30, 2019		December 31, 2018
Arch Mortgage Insurance Company	A-	22	%	24	%
Radian Guaranty Inc.	BBB	20		20
Mortgage Guaranty Insurance Corporation	BBB	18		19
Genworth Mortgage Insurance Corporation	BB+	15		14
Essent Guaranty, Inc.	BBB+	15		14
Total		90	%	91	%

(1) Ratings are for the corporate entity to which we have the greatest exposure. Latest rating available as of September 30, 2019. Represents the lower of S&P and Moody’s credit ratings stated in terms of the S&P equivalent.

(2) Includes primary mortgage insurance and pool insurance. Coverage amounts may include coverage provided by affiliates and subsidiaries of the counterparty.

The tables below summarize the concentration of single-family and multifamily sellers who provided 10% or more of our purchase volume during YTD 2019 or YTD 2018.

Table 14.3 - Seller Concentration

Single-family Sellers(1)	YTD 2019		YTD 2018
JPMorgan Chase Bank, N.A.	16	%	5	%
Wells Fargo Bank, N.A.	7		12
Other top 10 sellers	33		32
Top 10 single-family sellers	56	%	49	%
Multifamily Sellers(1)	YTD 2019		YTD 2018
CBRE Capital Markets, Inc.	16	%	19	%
Berkadia Commercial Mortgage LLC	15		12
Other top 10 sellers	48		47
Top 10 multifamily sellers	79	%	78	%

(1)

Sellers presented based on those with the highest percentage of purchase volume during YTD 2019.

Servicers

Significant portions of our single-family and multifamily loans are serviced by several large servicers. The tables below summarize the concentration of single-family and multifamily servicers who serviced 10% or more of our single-family credit guarantee portfolio and our multifamily mortgage portfolio as of September 30, 2019 or December 31, 2018. For purposes of determining the concentration of servicers in the tables below, our multifamily mortgage portfolio excludes loans underlying multifamily securitizations where we are not in first loss position, primarily K Certificates and SB Certificates.

Table 14.4 - Servicer Concentration

Single-family Servicers(2)	September 30, 2019(1)		December 31, 2018(1)
Wells Fargo Bank, N.A.	15	%	17	%
JPMorgan Chase Bank, N.A.	10		8
Other top 10 servicers	31		31
Top 10 single-family servicers	56	%	56	%

Multifamily Servicers(2)	September 30, 2019		December 31, 2018
Wells Fargo Bank, N.A.	15	%	14	%
Berkadia Commercial Mortgage LLC	11		11
CBRE Capital Markets, Inc.	11		14
Other top 10 servicers	40		36
Top 10 multifamily servicers	77	%	75	%

(1)

Percentage of servicing volume is based on the total single-family credit guarantee portfolio, which includes loans where we do not exercise servicing control. However, loans where we do not exercise servicing control are not included for purposes of determining the concentration of servicers who serviced more than 10% of our single-family credit guarantee portfolio because we do not know which entity serves as the primary servicer for such loan

Table - Certain Higher Risk Categories In Our Single Family Credit Guarantee Portfolio

Presented below is a summary of the serious delinquency rates of certain higher-risk categories (based on characteristics of the loan at origination) of loans in our single-family credit guarantee portfolio. The table includes a presentation of each higher-risk category in isolation. A single loan may fall within more than one category (for example, an interest-only loan may also have an original LTV ratio greater than 90%). Loans with a combination of these attributes will have an even higher risk of delinquency than those with an individual attribute.

Table 14.2 - Certain Higher Risk Categories in Our Single-Family Credit Guarantee Portfolio

	Percentage of Portfolio(1)				Serious Delinquency Rate(1)
(Percentage of portfolio based on UPB)	September 30, 2019		December 31, 2018		September 30, 2019		December 31, 2018
Interest-only	1	%	1	%	2.72	%	3.43	%
Alt-A	1		1		3.75		4.13
Original LTV ratio greater than 90%(2)	18		18		0.92		1.04
Lower credit scores at origination (less than 620)	2		2		4.24		4.59

(1) Excludes loans underlying certain other securitization products for which data was not available.

(2)

Includes HARP loans, which we purchased as part of our participation in the MHA Program.

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Segment Reporting

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

SEGMENT REPORTING

Segment Reporting

We have three reportable segments, which are based on the type of business activities each performs - Single-family Guarantee, Multifamily, and Capital Markets. Material corporate-level activities that are infrequent in nature and based on decisions outside the control of the management of our reportable segments are included in the All Other category. For more information, see our 2018 Annual Report.

Segment Earnings

We present Segment Earnings by reclassifying certain credit guarantee-related activities and investment-related activities between various line items on our GAAP condensed consolidated statements of comprehensive income and allocating certain revenues and expenses, including certain returns on assets, funding and hedging costs, and administrative expenses, to our three reportable segments.

We do not consider our assets by segment when evaluating segment performance or allocating resources. We operate our business in the United States and its territories, and accordingly, we generate no revenue from and have no long-lived assets, other than financial instruments, in geographic locations other than the United States and its territories.

We evaluate segment performance and allocate resources based on a Segment Earnings approach, subject to the conduct of our business under the direction of the Conservator. See Note 2 for information about the conservatorship.

The table below presents Segment Earnings by segment.

Table 13.1 - Segment Earnings

(In millions)	3Q 2019			3Q 2018		YTD 2019		YTD 2018
Segment Earnings (loss), net of taxes:
Single-family Guarantee		$1,250			$1,183		$2,945		$2,884
Multifamily	581			549		1,294		1,572
Capital Markets	(122		)	974		383		3,679
All Other	—			—		—		—
Total Segment Earnings, net of taxes	1,709			2,706		4,622		8,135
Net income (loss)		$1,709			$2,706		$4,622		$8,135
Comprehensive income (loss) of segments:
Single-family Guarantee		$1,247			$1,181		$2,936		$2,876
Multifamily	591			505		1,426		1,436
Capital Markets	10			873		977		2,832
All Other	—			—		—		—
Comprehensive income (loss) of segments	1,848			2,559		5,339		7,144
Comprehensive income (loss)		$1,848			$2,559		$5,339		$7,144

The tables below present detailed reconciliations between our GAAP condensed consolidated statements of comprehensive income and Segment Earnings for our reportable segments and All Other.

Table 13.2 - Segment Earnings and Reconciliations to GAAP Condensed Consolidated Statements of Comprehensive Income

	3Q 2019
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$292			$497			$—		$789			$1,621			$2,410
Guarantee fee income	2,075			233			—			—		2,308			(2,077		)	231
Benefit (provision) for credit losses	134			(1		)	—			—		133			46			179
Mortgage loans gains (losses)	—			1,087			—			—		1,087			615			1,702
Investment securities gains (losses)	—			31			136			—		167			(3		)	164
Debt gains (losses)	51			(69		)	(17		)	—		(35		)	(21		)	(56		)
Derivative gains (losses)	—			(793		)	(438		)	—		(1,231		)	14			(1,217		)
Other income (loss)	318			89			(234		)	—		173			(27		)	146
Administrative expense	(399		)	(125		)	(96		)	—		(620		)	—			(620		)
REO operations (expense) income	(61		)	—			—			—		(61		)	3			(58		)
Other non-interest (expense) income	(554		)	(17		)	(3		)	—		(574		)	(171		)	(745		)
Income tax (expense) benefit	(314		)	(146		)	33			—		(427		)	—			(427		)
Net income (loss)	1,250			581			(122		)	—		1,709			—			1,709
Changes in unrealized gains (losses) related to available-for-sale securities	—			10			114			—		124			—			124
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			19			—		19			—			19
Changes in defined benefit plans	(3		)	—			(1		)	—		(4		)	—			(4		)
Total other comprehensive income (loss), net of taxes	(3		)	10			132			—		139			—			139
Comprehensive income (loss)		$1,247			$591			$10			$—		$1,848			$—			$1,848
	YTD 2019
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$805			$2,002			$—		$2,807			$5,683			$8,490
Guarantee fee income	5,597			671			—			—		6,268			(5,598		)	670
Benefit (provision) for credit losses	221			(3		)	—			—		218			256			474
Mortgage loans gains (losses)	—			2,909			—			—		2,909			1,265			4,174
Investment securities gains (losses)	—			41			698			—		739			(11		)	728
Debt gains (losses)	113			(46		)	(27		)	—		40			(32		)	8
Derivative gains (losses)	(47		)	(2,650		)	(2,095		)	—		(4,792		)	(120		)	(4,912		)
Other income (loss)	836			292			198			—		1,326			(937		)	389
Administrative expense	(1,173		)	(357		)	(287		)	—		(1,817		)	—			(1,817		)
REO operations (expense) income	(185		)	—			—			—		(185		)	13			(172		)
Other non-interest (expense) income	(1,667		)	(38		)	(9		)	—		(1,714		)	(519		)	(2,233		)
Income tax (expense) benefit	(750		)	(330		)	(97		)	—		(1,177		)	—			(1,177		)
Net income (loss)	2,945			1,294			383			—		4,622			—			4,622
Changes in unrealized gains (losses) related to available-for-sale securities	—			134			540			—		674			—			674
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			57			—		57			—			57
Changes in defined benefit plans	(9		)	(2		)	(3		)	—		(14		)	—			(14		)
Total other comprehensive income (loss), net of taxes	(9		)	132			594			—		717			—			717
Comprehensive income (loss)		$2,936			$1,426			$977			$—		$5,339			$—			$5,339

	3Q 2018
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$280			$845			$—		$1,125			$2,132			$3,257
Guarantee fee income	1,676			210			—			—		1,886			(1,677		)	209
Benefit (provision) for credit losses	205			2			—			—		207			173			380
Mortgage loans gains (losses)	—			(17		)	—			—		(17		)	111			94
Investment securities gains (losses)	—			(97		)	(336		)	—		(433		)	(10		)	(443		)
Debt gains (losses)	20			5			137			—		162			(4		)	158
Derivative gains (losses)	(25		)	375			427			—		777			(49		)	728
Other income (loss)	387			27			179			—		593			(514		)	79
Administrative expense	(371		)	(109		)	(89		)	—		(569		)	—			(569		)
REO operations (expense) income	(42		)	—			—			—		(42		)	4			(38		)
Other non-interest (expense) income	(413		)	(14		)	—			—		(427		)	(166		)	(593		)
Income tax (expense) benefit	(254		)	(113		)	(189		)	—		(556		)	—			(556		)
Net income (loss)	1,183			549			974			—		2,706			—			2,706
Changes in unrealized gains (losses) related to available-for-sale securities	—			(44		)	(125		)	—		(169		)	—			(169		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			25			—		25			—			25
Changes in defined benefit plans	(2		)	—			(1		)	—		(3		)	—			(3		)
Total other comprehensive income (loss), net of taxes	(2		)	(44		)	(101		)	—		(147		)	—			(147		)
Comprehensive income (loss)		$1,181			$505			$873			$—		$2,559			$—			$2,559
	YTD 2018
	Single-family Guarantee			Multifamily			Capital Markets			All Other		Total Segment Earnings (Loss)			Reclassifications			Total per Consolidated Statements of Comprehensive Income
(In millions)
Net interest income		$—			$846			$2,410			$—		$3,256			$6,022			$9,278
Guarantee fee income	4,932			609			—			—		5,541			(4,938		)	603
Benefit (provision) for credit losses	366			20			—			—		386			(9		)	377
Mortgage loans gains (losses)	—			(233		)	—			—		(233		)	466			233
Investment securities gains (losses)	—			(353		)	(524		)	—		(877		)	(147		)	(1,024		)
Debt gains (losses)	80			22			368			—		470			(25		)	445
Derivative gains (losses)	(37		)	1,254			2,038			—		3,255			(281		)	2,974
Other income (loss)	592			128			541			—		1,261			(613		)	648
Administrative expense	(1,070		)	(315		)	(262		)	—		(1,647		)	—			(1,647		)
REO operations (expense) income	(101		)	1			—			—		(100		)	13			(87		)
Other non-interest (expense) income	(1,192		)	(33		)	(6		)	—		(1,231		)	(488		)	(1,719		)
Income tax (expense) benefit	(686		)	(374		)	(886		)	—		(1,946		)	—			(1,946		)
Net income (loss)	2,884			1,572			3,679			—		8,135			—			8,135
Changes in unrealized gains (losses) related to available-for-sale securities	—			(134		)	(931		)	—		(1,065		)	—			(1,065		)
Changes in unrealized gains (losses) related to cash flow hedge relationships	—			—			87			—		87			—			87
Changes in defined benefit plans	(8		)	(2		)	(3		)	—		(13		)	—			(13		)
Total other comprehensive income (loss), net of taxes	(8		)	(136		)	(847		)	—		(991		)	—			(991		)
Comprehensive income (loss)		$2,876			$1,436			$2,832			$—		$7,144			$—			$7,144

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Derivatives

9 Months Ended

Sep. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES

Derivatives

Use of Derivatives

We use derivatives primarily to hedge interest-rate sensitivity mismatches between our financial assets and liabilities. We analyze the interest-rate sensitivity of financial assets and liabilities on a daily basis across a variety of interest-rate scenarios based on market prices, models, and economics. When we use derivatives to mitigate our exposures, we consider a number of factors, including cost, exposure to counterparty risk, and our overall risk management strategy.

We classify derivatives into three categories:

n Exchange-traded derivatives;

n Cleared derivatives; and

n OTC derivatives.

Exchange-traded derivatives include standardized interest-rate futures contracts and options on futures contracts. Cleared derivatives refer to those interest-rate swaps that the U.S. Commodity Futures Trading Commission has determined are subject to the central clearing requirement of the Dodd-Frank Act. OTC derivatives refer to those derivatives that are neither exchange-traded derivatives nor cleared derivatives.

Types of Derivatives

We principally use the following types of derivatives:

n LIBOR- and SOFR-based interest-rate swaps;

n LIBOR- and Treasury-based purchased options (including swaptions); and

n LIBOR-, Treasury-, and SOFR-based exchange-traded futures.

We also purchase swaptions on credit indices in order to obtain protection against adverse movements in multifamily spreads which may affect the profitability of our K Certificate or SB Certificate transactions.

In addition to swaps, futures, and purchased options, our derivative positions include written options and swaptions, commitments, and credit derivatives.

Hedge Accounting

Fair Value Hedges

We apply fair value hedge accounting to certain single-family mortgage loans and certain issuances of debt where we hedge the changes in fair value of these items attributable to the designated benchmark interest rate (i.e., LIBOR), using LIBOR-based interest-rate swaps. Beginning in September 2019, we implemented a new fair value hedge accounting strategy for single-family mortgage loans that applies certain hedge accounting elections, including the last-of-layer method, allowable under amended hedge accounting guidance we adopted during 4Q 2017. Under the last-of-layer method, we hedge the changes in fair value of a portion of a closed pool of single-family mortgage loans that is not expected to be affected by prepayments, defaults, and other events affecting the timing and amount of cash flows. As part of this new strategy, we have also elected to measure the change in fair value of the hedged item on the basis of the benchmark rate component of the contractual coupon cash flows determined at the hedge inception and by assuming the hedged item has a term that reflects only the designated cash flows being hedged.

If a hedge relationship qualifies for fair value hedge accounting, all changes in fair value of the derivative hedging instrument, including interest accruals, are recognized in the same condensed consolidated statements of comprehensive income line item used to present the earnings effect of the hedged item. Therefore, changes in the fair value of the hedged item, mortgage loans and debt, attributable to the risk being hedged are recognized in interest income - mortgage loans and interest expense, respectively, along with the changes in the fair value of the respective derivative hedging instruments.

Cash Flow Hedges

There are amounts recorded in AOCI related to discontinued cash flow hedges which are recognized in earnings when the originally forecasted transactions affect earnings. Amounts reclassified from AOCI are recorded in interest expense. During YTD 2019 and YTD 2018, we reclassified from AOCI into earnings, pre-tax losses of $72 million and $106 million, respectively, related to closed cash flow hedges. See Note 11 for information about future reclassifications of deferred net losses related to

closed cash flow hedges to net income.

Derivative Assets and Liabilities at Fair Value

The table below presents the notional value and fair value of derivatives reported on our condensed consolidated balance sheets.

Table 9.1 - Derivative Assets and Liabilities at Fair Value

	September 30, 2019								December 31, 2018
	Notional or Contractual Amount		Derivatives at Fair Value						Notional or Contractual Amount		Derivatives at Fair Value
(In millions)			Assets			Liabilities					Assets			Liabilities
Not designated as hedges
Interest-rate swaps:
Receive-fixed		$217,377		$2,346			($10	)		$145,386		$1,380			($181	)
Pay-fixed	246,557		6			(4,381		)	170,899		476			(2,287		)
Basis (floating to floating)	5,924		—			—			5,404		1			—
Total interest-rate swaps	469,858		2,352			(4,391		)	321,689		1,857			(2,468		)
Option-based:
Call swaptions
Purchased	61,275		3,963			—			43,625		2,007			—
Written	2,500		—			(37		)	4,400		—			(133		)
Put swaptions
Purchased(1)	63,600		512			—			88,075		1,565			—
Written	8,700		—			(41		)	1,750		—			(4		)
Other option-based derivatives(2)	10,368		721			—			10,481		628			—
Total option-based	146,443		5,196			(78		)	148,331		4,200			(137		)
Futures	181,479		—			—			161,185		—			—
Commitments	152,300		195			(171		)	36,044		90			(179		)
Credit derivatives	1,822		1			(23		)	2,030		—			(35		)
Other	16,991		12			(103		)	12,212		1			(103		)
Total derivatives not designated as hedges	968,893		7,756			(4,766		)	681,491		6,148			(2,922		)
Designated as fair value hedges
Interest-rate swaps:
Receive-fixed	113,425		145			(91		)	117,038		23			(935		)
Pay-fixed	78,966		7			(1,620		)	77,513		247			(571		)
Total derivatives designated as fair value hedges	192,391		152			(1,711		)	194,551		270			(1,506		)
Derivative interest and other receivable (payable)			912			(872		)			889			(1,096		)
Netting adjustments(3)			(7,228		)	6,994					(6,972		)	4,941
Total derivative portfolio, net		$1,161,284		$1,592			($355	)		$876,042		$335			($583	)

(1) Includes swaptions on credit indices with a notional or contractual amount of $17.3 billion and $45.9 billion at September 30, 2019 and December 31, 2018, respectively, and a fair value of $6.0 million and $113.0 million at September 30, 2019 and December 31, 2018, respectively.

(2) Primarily consists of purchased interest-rate caps and floors.

(3) Represents counterparty netting and cash collateral netting.

See Note 10 for information related to our derivative counterparties and collateral held and posted.

Gains and Losses on Derivatives

The table below presents the gains and losses on derivatives, including the accrual of periodic cash settlements, while not designated in qualifying hedge relationships and reported on our condensed consolidated statements of comprehensive income as derivative gains (losses).

Table 9.2 - Gains and Losses on Derivatives

(In millions)	3Q 2019			3Q 2018			YTD 2019			YTD 2018
Not designated as hedges
Interest-rate swaps:
Receive-fixed		$2,060			($1,004	)		$7,580			($5,080	)
Pay-fixed	(3,866		)	1,721			(12,152		)	7,922
Basis (floating to floating)	(3		)	19			7			(9		)
Total interest-rate swaps	(1,809		)	736			(4,565		)	2,833
Option-based:
Call swaptions
Purchased	1,398			(402		)	2,981			(1,392		)
Written	(109		)	35			(343		)	76
Put swaptions
Purchased	(355		)	136			(1,406		)	524
Written	19			(2		)	83			(23		)
Other option-based derivatives(1)	(6		)	(73		)	93			(205		)
Total option-based	947			(306		)	1,408			(1,020		)
Other:
Futures	(262		)	277			(1,283		)	728
Commitments	(54		)	69			(366		)	672
Credit derivatives	6			(4		)	1			(14		)
Other	2			(71		)	36			(64		)
Total other	(308		)	271			(1,612		)	1,322
Accrual of periodic cash settlements:
Receive-fixed interest-rate swaps	39			39			(32		)	335
Pay-fixed interest-rate swaps	(126		)	(50		)	(220		)	(536		)
Other	40			38			109			40
Total accrual of periodic cash settlements	(47		)	27			(143		)	(161		)
Total		($1,217	)		$728			($4,912	)		$2,974

(1)

Primarily consists of purchased interest-rate caps and floors.

Fair Value Hedges

The tables below present the effects of fair value hedge accounting by condensed consolidated statements of comprehensive income line, including the gains and losses on derivatives and hedged items designated in qualifying hedge relationships and other components due to the application of hedge accounting.

Table 9.3 - Gains and Losses on Fair Value Hedges

	3Q 2019						3Q 2018
(In millions)	Interest Income - Mortgage Loans			Interest Expense			Interest Income - Mortgage Loans			Interest Expense
Total amounts of income and expense line items presented in our condensed consolidated statements of comprehensive income in which the effects of fair value hedges are recorded:		$16,428			($15,130	)		$16,787			($14,546	)
Interest contracts on mortgage loans held-for-investment:
Gain (loss) on fair value hedging relationships:
Hedged items	1,298			—			(755		)	—
Derivatives designated as hedging instruments	(1,588		)	—			776			—
Interest accruals on hedging instruments	(48		)	—			(96		)	—
Discontinued hedge-related basis adjustments amortization	(210		)	—			38			—
Interest contracts on debt:
Gain (loss) on fair value hedging relationships:
Hedged items	—			(36		)	—			121
Derivatives designated as hedging instruments	—			91			—			(50		)
Interest accruals on hedging instruments	—			(18		)	—			(96		)
Discontinued hedge-related basis adjustments amortization	—			18			—			(1		)

	YTD 2019						YTD 2018
(In millions)	Interest Income - Mortgage Loans			Interest Expense			Interest Income - Mortgage Loans			Interest Expense
Total amounts of income and expense line items presented in our condensed consolidated statements of comprehensive income in which the effects of fair value hedges are recorded:		$51,732			($46,498	)		$49,082			($42,802	)
Interest contracts on mortgage loans held-for-investment:
Gain (loss) on fair value hedging relationships:
Hedged items	5,691			—			(3,441		)	—
Derivatives designated as hedging instruments	(5,609		)	—			3,087			—
Interest accruals on hedging instruments	(4		)	—			(373		)	—
Discontinued hedge-related basis adjustments amortization	(229		)	—			86			—
Interest contracts on debt:
Gain (loss) on fair value hedging relationships:
Hedged items	—			(1,141		)	—			931
Derivatives designated as hedging instruments	—			1,288			—			(728		)
Interest accruals on hedging instruments	—			(230		)	—			(219		)
Discontinued hedge-related basis adjustments amortization	—			43			—			(2		)

Cumulative Basis Adjustments Due to Fair Value Hedging

The tables below present the hedged item cumulative basis adjustments due to qualifying fair value hedging and the related hedged item carrying amounts by their respective balance sheet line item.

Table 9.4 - Cumulative Basis Adjustments Due to Fair Value Hedging

	September 30, 2019
	Carrying Amount Assets / (Liabilities)			Cumulative Amount of Fair Value Hedging Basis Adjustment Included in the Carrying Amount									Closed Portfolio Under the Last-of-Layer Method
(In millions)				Total			Under the Last-of-Layer Method			Discontinued - Hedge Related			Total Amount by Amortized Cost Basis		Designated Amount by UPB
Mortgage loans held-for-investment		$470,584			$4,225			($379	)		$4,604			$266,975		$20,472
Debt	(130,653		)	(848		)	—			(114		)	—		—
	December 31, 2018
	Carrying Amount Assets / (Liabilities)			Cumulative Amount of Fair Value Hedging Basis Adjustment Included in the Carrying Amount									Closed Portfolio Under the Last-of-Later Method
(In millions)				Total			Under the Last-of-Layer Method			Discontinued - Hedge Related			Total Amount by Amortized Cost Basis		Designated Amount by UPB
Mortgage loans held-for-investment		$193,547			($1,237	)		$—			($1,237	)		$—		$—
Debt	(127,215		)	216			—			(8		)	—		—

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Guarantee Activities

9 Months Ended

Sep. 30, 2019

Guarantees [Abstract]

GUARANTEE ACTIVITIES

Guarantee Activities

We generate revenue through our guarantee activities by agreeing to absorb the credit risk associated with certain financial instruments that are owned or held by third parties. In exchange for providing this guarantee, we receive an ongoing guarantee fee that is commensurate with the risks assumed and that will, over the long-term, provide us with cash flows that are expected to exceed the credit-related and administrative expenses of the underlying financial instruments. The profitability of our guarantee activities may vary and will be dependent on our guarantee fee and the actual credit performance of the underlying financial instruments that we have guaranteed.

The table below shows our maximum exposure, recognized liability, and maximum remaining term of our recognized guarantees to non-consolidated VIEs and other third parties. This table does not include our unrecognized guarantees, such as guarantees to consolidated VIEs or to resecuritization trusts that do not expose us to incremental credit risk. The maximum exposure disclosed in the table is not representative of the actual loss we are likely to incur, based on our historical loss experience and after consideration of proceeds from related collateral liquidation, including possible recoveries under credit enhancement arrangements. See Note 6 for additional information on our credit enhancement arrangements.

As part of the Single Security Initiative, we have the ability to commingle TBA-eligible Fannie Mae collateral in certain of our resecuritization products. We extend our guarantee of these products to cover principal and interest that are payable from the underlying Fannie Mae collateral. Because both Freddie Mac and Fannie Mae are under the common control of FHFA, and due to Fannie Mae’s status as a GSE and the funding commitment available to it through its senior preferred stock purchase agreement with Treasury, we view the likelihood of being required to perform on our guarantee of Fannie Mae collateral as remote and do not charge an incremental guarantee fee to include Fannie Mae securities in our resecuritization products. Thus, we do not record a guarantee obligation with respect to Fannie Mae securities backing Freddie Mac resecuritization products, and we exclude from the following table approximately $17 billion of Fannie Mae securities backing Freddie Mac resecuritization products as of September 30, 2019.

Table 5.1 - Financial Guarantees

	September 30, 2019					December 31, 2018
(Dollars in millions, terms in years)	Maximum Exposure(1)		Recognized Liability(2)		Maximum Remaining Term	Maximum Exposure(1)		Recognized Liability(2)		Maximum Remaining Term
Single-family:
Securitization activity guarantees		$24,387		$317	40		$17,783		$220	40
Other mortgage-related guarantees	7,139		180		30	6,139		167		30
Total single-family		$31,526		$497			$23,922		$387
Multifamily:
Securitization activity guarantees		$241,853		$3,128	40		$221,245		$2,746	40
Other mortgage-related guarantees	10,122		430		35	9,779		428		35
Total multifamily		$251,975		$3,558			$231,024		$3,174
Other guarantees measured at fair value		$24,976		$183	30		$16,251		$242	30

(1) The maximum exposure represents the contractual amounts that could be lost if counterparties or borrowers defaulted, without consideration of possible recoveries under credit enhancement arrangements, such as recourse provisions, third-party insurance contracts, or from collateral held or pledged. For other guarantees measured at fair value, this amount represents the notional value if it relates to our market value guarantees or guarantees of third-party derivative instruments or the UPB if it relates to a guarantee of a mortgage-related asset. For certain of our other guarantees measured at fair value, our exposure may be unlimited. We generally reduce our exposure to these guarantees with unlimited exposure through separate contracts with third parties.

(2)

For securitization activity guarantees and other mortgage-related guarantees, this amount represents the guarantee obligation on our condensed consolidated balance sheets. This amount excludes our reserve for guarantee losses, which totaled $51 million and $52 million as of September 30, 2019 and December 31, 2018, respectively, and is included within other liabilities on our condensed consolidated balance sheets. For other guarantees measured at fair value, this amount represents the fair value of the contract.

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Stockholders' Equity and Earnings per Share (Details) - USD ($)	3 Months Ended				9 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2019	Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017
Stockholders Equity Text [Line Items]
Federal statutory tax rate	21.00%			21.00%	21.00%	21.00%
Cash flow hedge relationships	$ (258,000,000)			$ (300,000,000)	$ (258,000,000)	$ (300,000,000)		$ (315,000,000)
Cash flow hedge gain (loss) to be reclassified over the next 12 months	$ (49,000,000)
Maximum remaining length of time hedged in cash flow hedge	14 years
Applicable capital reserve amount prior to July 1, 2019	$ 3,000,000,000.0				3,000,000,000.0
Applicable capital reserve amount from July 1, 2019 and thereafter	20,000,000,000.0				20,000,000,000.0
GAAP net worth (deficit)	6,674,000,000	$ 4,826,000,000		$ 5,559,000,000	6,674,000,000	5,559,000,000		4,477,000,000	$ 4,585,000,000	$ (312,000,000)
Cash dividends paid on senior preferred stock	0	1,700,000,000	$ 1,500,000,000		3,142,000,000	$ 1,585,000,000
Expected draw request from Treasury	0				0
Dividend Requirement Amount Under Purchase Agreement	0				0
Aggregate Payment of Dividend to Treasury Under Purchase Agreement	119,700,000,000				119,700,000,000
Senior preferred stock, at redemption value	77,474,000,000	75,600,000,000			77,474,000,000			$ 75,648,000,000
Preference liquidation maximum increase	17,000,000,000.0				$ 17,000,000,000.0
Net worth increase	$ 1,800,000,000	$ 1,800,000,000
Stock options outstanding	0			0	0	0
Common dividends declared					$ 0
Common shares or non-cumulative preferred stock repurchased	$ 0
Common shares or non-cumulative preferred stock issued	$ 0
Dividends declared on preferred stock					0
Dividends paid on preferred stock					$ 0
Subsequent Event [Member]
Stockholders Equity Text [Line Items]
Senior preferred stock, at redemption value							$ 79,300,000,000

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Derivatives (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion, Net	$ 72	$ 106

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Derivatives Derivatives - Cumulative Basis Adjustment due to Fair Value Hedges (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Carrying amount mortgage loans held-for-investment hedged asset	$ 470,584	$ 193,547
Carrying amount debt hedged liability	(130,653)	(127,215)
Total basis adjustment cumulative amount for hedged asset	4,225	(1,237)
Total basis adjustment cumulative amount for hedged liability	(848)	216
Hedged Asset, Fair Value Hedge, Last-of-Layer, Cumulative Increase (Decrease)	(379)	0
Basis adjustment amount for hedged asset - discontinued hedge	4,604	(1,237)
Basis adjustment amount for hedged liability - discontinued hedge	(114)	(8)
Total Amount by Amortized Cost Basis Under the Last-of-Layer Method	266,975	0
Designated Amount by UPB	$ 20,472	$ 0

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Securitization Activities and Consolidation

9 Months Ended

Sep. 30, 2019

Securitization Activities and Consolidation [Abstract]

Variable Interest Entity Disclosure [Text Block]

Securitization Activities and Consolidation

Our primary business activities in our Single-family Guarantee and Multifamily segments involve the securitization of loans or other mortgage-related assets using trusts that are VIEs. These trusts issue beneficial interests in the loans or other mortgage-related assets that they own. We guarantee the principal and interest payments on some or all of the issued beneficial interests in substantially all of our securitization transactions. We consolidate VIEs when we have a controlling financial interest in the VIE and are therefore considered the primary beneficiary of the VIE. See Note 5 for additional information on our guarantee activities.

Consolidated VIEs

The table below presents the carrying value and classification of the assets and liabilities of consolidated VIEs on our condensed consolidated balance sheets.

Table 3.1 - Consolidated VIEs

(In millions)	As of September 30, 2019		As of December 31, 2018
Condensed Consolidated Balance Sheet Line Item
Assets:
Cash and cash equivalents (includes $3,494 and $566 of restricted cash and cash equivalents)		$3,495		$567
Securities purchased under agreements to resell	21,400		12,125
Investments in securities, at fair value	766		—
Mortgage loans held-for-investment	1,905,633		1,842,850
Accrued interest receivable	6,109		5,914
Other assets	12,093		1,631
Total assets of consolidated VIEs		$1,949,496		$1,863,087
Liabilities:
Accrued interest payable		$5,519		$5,335
Debt, net	1,869,308		1,792,677
Total liabilities of consolidated VIEs		$1,874,827		$1,798,012

Non-Consolidated VIEs

Our involvement with VIEs for which we are not the primary beneficiary takes one or both of two forms - purchasing an investment in these entities or providing a guarantee to these entities. As part of the Single Security Initiative, we have the ability to commingle TBA-eligible Fannie Mae collateral in certain of our resecuritization products that we do not consolidate. We extend our guarantee of these products to cover principal and interest that are payable from the underlying Fannie Mae collateral. See Note 5 for additional information on our guarantee of Fannie Mae securities.

The following table presents the carrying amounts and classification of the assets and liabilities recorded on our condensed consolidated balance sheets related to non-consolidated VIEs with which we were involved in the design and creation and have a significant continuing involvement, as well as our maximum exposure to loss and total assets of the VIEs. Our maximum exposure to loss includes the guaranteed UPB of assets held by the non-consolidated VIEs, the UPB of unguaranteed securities that we acquired from these securitization transactions, and the UPB of guarantor advances made to the holders of the guaranteed securities. Our maximum exposure to loss and total assets of non-consolidated VIEs excludes our investments in and obligations to non-consolidated Freddie Mac resecuritization trusts because we already consolidate the underlying Freddie Mac collateral of these trusts on our condensed consolidated balance sheets and for commingled resecuritization trusts, we view the likelihood of being required to perform on our guarantee of the underlying Fannie Mae collateral as remote. Our maximum exposure to loss also excludes our interest rate exposure on certain securitization activity and other mortgage-related guarantees measured at fair value where our interest rate exposure may be unlimited. We generally reduce our exposure to these guarantees with unlimited interest rate exposure through separate contracts with third parties.

We do not believe the maximum exposure to loss disclosed in the table below is representative of the actual loss we are likely to incur, based on our historical loss experience and after consideration of proceeds from related collateral liquidation, including possible recoveries under credit enhancement arrangements. See Note 6 for additional information on credit enhancement arrangements.

Table 3.2 - Non-Consolidated VIEs

(In millions)	As of September 30, 2019		As of December 31, 2018
Assets and Liabilities Recorded on our Condensed Consolidated Balance Sheets(1)
Assets:
Investments in securities, at fair value		$39,091		$44,020
Accrued interest receivable	214		235
Derivative assets, net	12		1
Other assets	3,737		3,119
Liabilities:
Derivative liabilities, net	89		88
Other liabilities	3,511		3,049
Maximum Exposure to Loss	268,269		241,055
Total Assets of Non-Consolidated VIEs	320,221		284,724

(1) Includes our variable interests in REMICs and Strips, commingled Supers, K Certificates, SB Certificates, certain senior subordinate securitization structures, other securitization products, and other risk transfer securitizations that we do not consolidate.

We also obtain interests in various other VIEs created by third parties through the normal course of business. To the extent that we were not involved in the design and creation of these VIEs, they are excluded from the table above. Our interests in these VIEs are generally passive in nature and are not expected to result in us obtaining a controlling financial interest in these VIEs in the future.

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Income Taxes (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Income Tax Expense (Benefit)	$ 427,000,000	$ 556,000,000	$ 1,177,000,000	$ 1,946,000,000
Effective Tax Rate	20.00%	17.00%	20.30%	19.30%
Federal statutory tax rate	21.00%	21.00%	21.00%	21.00%
Deferred Tax Assets, Net	$ 5,800,000,000		$ 5,800,000,000		$ 6,900,000,000
Deferred Tax Assets, Valuation Allowance	37,000,000		37,000,000
Unrecognized Tax Benefits	$ 0		$ 0

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Oct. 15, 2019
Cover page.
Document Quarterly Report	true
Document Transition Report	false
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Entity File Number	001-34139
Entity Registrant Name	Federal Home Loan Mortgage Corporation
Entity Incorporation, State or Country Code	X1
Entity Tax Identification Number	52-0904874
Entity Address, Address Line One	8200 Jones Branch Drive
Entity Address, City or Town	McLean,
Entity Address, State or Province	VA
Entity Address, Postal Zip Code	22102-3110
City Area Code	(703)
Local Phone Number	903-2000
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		650,059,033
Entity Central Index Key	0001026214
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false

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Concentration of Credit and Other Risks (Details) - USD ($) $ in Billions	9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Concentration Risk [Line Items]
Unpaid principal balance related to single-family credit guarantee portfolio	$ 2,000.0		$ 1,900.0
Securities purchased under agreements to resell used to provide financing to investors	$ 2.2		$ 2.5
Single-family UPB
Concentration Risk [Line Items]
Concentration risk percentage	100.00%		100.00%
Top five non-depository seller | Single-family loan purchase volume
Concentration Risk [Line Items]
Concentration risk percentage	26.00%	22.00%
Five largest non-depository servicers | Single-family UPB
Concentration Risk [Line Items]
Concentration risk percentage	18.00%		16.00%
Mortgage Insurers
Concentration Risk [Line Items]
Unpaid principal balance of single family credit guarantee portfolio With mortgage insurance coverage	$ 411.0
Credit protection coverage from mortgage insurers for single family credit guarantee portfolio	105.2
Cash proceeds received from mortgage insurers	0.1	$ 0.2
Receivables outstanding from mortgage Insurers	0.1		$ 0.1
Receivables outstanding, net of reserves, from mortgage insurers	0.1		0.1
Amount of cumulative unpaid deferred payment obligation	0.5		0.5
Cash And Other Investment Counterparties
Concentration Risk [Line Items]
Cash and other non-mortgage investments	$ 89.6		$ 63.1

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Consolidated Statements of Equity - USD ($) shares in Millions, $ in Millions	Total	Senior Preferred Stock	Preferred Stock, at Redemption Value	Common Stock, at Par Value	Additional Paid-In Capital	Retained Earnings (Accumulated Deficit)	AOCI, Net of Tax	Treasury Stock, at Cost
Beginning balance at Dec. 31, 2017	$ (312)	$ 72,336	$ 14,109	$ 0	$ 0	$ (83,261)	$ 389	$ (3,885)
Beginning balance, Shares at Dec. 31, 2017		1	464	650
Comprehensive income:
Net income (loss)	8,135					8,135
Other comprehensive income, net of taxes	(991)						(991)
Comprehensive income (loss)	7,144					8,135	(991)
Cumulative effect of change in accounting principle	0					(89)	89
Increase in liquidation preference	312	$ 312
Senior Preferred Stock Dividends Paid	(1,585)					(1,585)
Ending balance at Sep. 30, 2018	5,559	$ 72,648	$ 14,109	$ 0	0	(76,800)	(513)	(3,885)
Ending balance, Shares at Sep. 30, 2018		1	464	650
Beginning balance at Jun. 30, 2018	4,585	$ 72,648	$ 14,109	$ 0	0	(77,921)	(366)	(3,885)
Beginning balance, Shares at Jun. 30, 2018		1	464	650
Comprehensive income:
Net income (loss)	2,706					2,706
Other comprehensive income, net of taxes	(147)						(147)
Comprehensive income (loss)	2,559					2,706	(147)
Senior Preferred Stock Dividends Paid	(1,585)					(1,585)
Ending balance at Sep. 30, 2018	5,559	$ 72,648	$ 14,109	$ 0	0	(76,800)	(513)	(3,885)
Ending balance, Shares at Sep. 30, 2018		1	464	650
Beginning balance at Dec. 31, 2018	4,477	$ 72,648	$ 14,109	$ 0	0	(78,260)	(135)	(3,885)
Beginning balance, Shares at Dec. 31, 2018		1	464	650
Comprehensive income:
Net income (loss)	4,622					4,622
Other comprehensive income, net of taxes	717						717
Comprehensive income (loss)	5,339					4,622	717
Senior Preferred Stock Dividends Paid	(3,142)					(3,142)
Ending balance at Sep. 30, 2019	6,674	$ 72,648	$ 14,109	$ 0	0	(76,780)	582	(3,885)
Ending balance, Shares at Sep. 30, 2019		1	464	650
Beginning balance at Jun. 30, 2019	4,826	$ 72,648	$ 14,109	$ 0	0	(78,489)	443	(3,885)
Beginning balance, Shares at Jun. 30, 2019		1	464	650
Comprehensive income:
Net income (loss)	1,709					1,709
Other comprehensive income, net of taxes	139						139
Comprehensive income (loss)	1,848					1,709	139
Ending balance at Sep. 30, 2019	$ 6,674	$ 72,648	$ 14,109	$ 0	$ 0	$ (76,780)	$ 582	$ (3,885)
Ending balance, Shares at Sep. 30, 2019		1	464	650

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Collateral and Offsetting of Assets and Liabilities - Collateral in the Form of Securities Pledged (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	$ 12,917	$ 8,802
Derivatives
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	3,975	2,522
Securities Sold under Agreements to Repurchase
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	8,713	6,027
Other
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	229	253
Cash and Cash Equivalents [Member]
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	284	2,595
Cash and Cash Equivalents [Member] | Derivatives
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	0	0
Cash and Cash Equivalents [Member] | Securities Sold under Agreements to Repurchase
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	284	2,595
Cash and Cash Equivalents [Member] | Other
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	0	0
Debt securities of consolidated trusts
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	916	541
Debt securities of consolidated trusts | Derivatives
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	747	362
Debt securities of consolidated trusts | Securities Sold under Agreements to Repurchase
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	0	0
Debt securities of consolidated trusts | Other
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	169	179
Available-for-sale Securities [Member]
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	3	1
Available-for-sale Securities [Member] | Derivatives
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	0	0
Available-for-sale Securities [Member] | Securities Sold under Agreements to Repurchase
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	0	0
Available-for-sale Securities [Member] | Other
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	3	1
Trading securities
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	11,714	5,665
Trading securities | Derivatives
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	3,228	2,160
Trading securities | Securities Sold under Agreements to Repurchase
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	8,429	3,432
Trading securities | Other
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	$ 57	$ 73

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Credit Enhancements - Mortgage Loan Credit Enhancements (Details) - Single-family - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
ACIS transactions
Credit Enhancement [Line Items]
Collateral posted by counterparties on ACIS transactions	$ 2,000	$ 1,500
Mortgage Loan Credit Enhancements
Credit Enhancement [Line Items]
Maximum coverage	130,476	116,534
Mortgage Loan Credit Enhancements | Primary mortgage insurance
Credit Enhancement [Line Items]
Total current and protected UPB	410,999	378,594
Maximum coverage	105,171	96,996
Mortgage Loan Credit Enhancements | ACIS transactions
Credit Enhancement [Line Items]
Total current and protected UPB	869,148	807,885
Maximum coverage	10,081	9,123
Mortgage Loan Credit Enhancements | STACR Trust transactions
Credit Enhancement [Line Items]
Total current and protected UPB	280,889	161,152
Maximum coverage	9,154	5,026
Mortgage Loan Credit Enhancements | Single family other transactions
Credit Enhancement [Line Items]
Total current and protected UPB	28,347	18,136
Maximum coverage	$ 6,070	$ 5,389

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Mortgage Loans and Loan Loss Reserves - TDR Activity (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($) numberofloans	Sep. 30, 2018 USD ($) numberofloans	Sep. 30, 2019 USD ($) numberofloans	Sep. 30, 2018 USD ($) numberofloans
Single-family 20 and 30-year or more, amortizing fixed-rate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | numberofloans	5,908	7,157	19,668	37,847
Post TDR Recorded Investments	$ 998	$ 1,091	$ 3,262	$ 6,159
Single-family 15-year amortizing fixed-rate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | numberofloans	693	909	2,364	5,194
Post TDR Recorded Investments	$ 69	$ 83	$ 230	$ 514
Single-family Adjustable-rate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | numberofloans	128	197	403	773
Post TDR Recorded Investments	$ 22	$ 27	$ 64	$ 122
Single-family Alt-A, interest-only, and option ARM
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | numberofloans	285	414	1,331	2,294
Post TDR Recorded Investments	$ 45	$ 65	$ 190	$ 379
Single-family
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | numberofloans	7,014	8,677	23,766	46,108
Post TDR Recorded Investments	$ 1,134	$ 1,266	$ 3,746	$ 7,174
Pre-TDR Recorded Investments	$ 1,100	$ 1,300	$ 3,700	$ 7,200
Multifamily
Financing Receivable, Troubled Debt Restructuring [Line Items]
Number of Loans | numberofloans	0	0	0	1
Post TDR Recorded Investments	$ 0	$ 0	$ 0	$ 15

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Collateral and Offsetting of Assets and Liabilities (Tables)

9 Months Ended

Sep. 30, 2019

Offsetting [Abstract]

Table - Offsetting of Financial Assets and Liabilities

The tables below display offsetting and collateral information related to derivatives, securities purchased under agreements to resell, and securities sold under agreements to repurchase which are subject to enforceable master netting agreements or similar arrangements. Securities sold under agreements to repurchase are included in debt, net on our condensed consolidated balance sheets.

Table 10.1 - Offsetting and Collateral Information of Financial Assets and Liabilities

	September 30, 2019
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$8,583			($5,373	)		($1,975	)		$1,235			($1,191	)		$44
Cleared and exchange-traded derivatives	29			(1		)	121			149			—			149
Other	208			—			—			208			—			208
Total derivatives	8,820			(5,374		)	(1,854		)	1,592			(1,191		)	401
Securities purchased under agreements to resell(3)	51,187			—			—			51,187			(51,187		)	—
Total		$60,007			($5,374	)		($1,854	)		$52,779			($52,378	)		$401
Liabilities:
Derivatives:
OTC derivatives		($7,029	)		$5,373			$1,601			($55	)		$—			($55	)
Cleared and exchange-traded derivatives	(23		)	1			19			(3		)	—			(3		)
Other	(297		)	—			—			(297		)	—			(297		)
Total derivatives	(7,349		)	5,374			1,620			(355		)	—			(355		)
Securities sold under agreements to repurchase(3)	(8,700		)	—			—			(8,700		)	8,700			—
Total		($16,049	)		$5,374			$1,620			($9,055	)		$8,700			($355	)

Referenced footnotes are included after the next table.

	December 31, 2018
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance  Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$7,213			($4,544	)		($2,448	)		$221			($173	)		$48
Cleared and exchange-traded derivatives	3			—			20			23			—			23
Other	91			—			—			91			—			91
Total derivatives	7,307			(4,544		)	(2,428		)	335			(173		)	162
Securities purchased under agreements to resell(3)	34,771			—			—			34,771			(34,771		)	—
Total		$42,078			($4,544	)		($2,428	)		$35,106			($34,944	)		$162
Liabilities:
Derivatives:
OTC derivatives		($4,963	)		$4,544			$296			($123	)		$—			($123	)
Cleared and exchange-traded derivatives	(244		)	—			101			(143		)	—			(143		)
Other	(317		)	—			—			(317		)	—			(317		)
Total derivatives	(5,524		)	4,544			397			(583		)	—			(583		)
Securities sold under agreements to repurchase(3)	(6,019		)	—			—			(6,019		)	6,019			—
Total		($11,543	)		$4,544			$397			($6,602	)		$6,019			($583	)

(1) Excess cash collateral held is presented as a derivative liability, while excess cash collateral posted is presented as a derivative asset.

(2) Does not include the fair value amount of non-cash collateral posted or held that exceeds the associated net asset or liability, netted by counterparty, presented on the condensed consolidated balance sheets. For cleared and exchange-traded derivatives, does not include non-cash collateral posted by us as initial margin with an aggregate fair value of $4.0 billion and $2.5 billion as of September 30, 2019 and December 31, 2018, respectively.

(3) Does not include the impacts of netting by central clearing organizations.

Table - Offsetting of Financial Assets and Liabilities

The tables below display offsetting and collateral information related to derivatives, securities purchased under agreements to resell, and securities sold under agreements to repurchase which are subject to enforceable master netting agreements or similar arrangements. Securities sold under agreements to repurchase are included in debt, net on our condensed consolidated balance sheets.

Table 10.1 - Offsetting and Collateral Information of Financial Assets and Liabilities

	September 30, 2019
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$8,583			($5,373	)		($1,975	)		$1,235			($1,191	)		$44
Cleared and exchange-traded derivatives	29			(1		)	121			149			—			149
Other	208			—			—			208			—			208
Total derivatives	8,820			(5,374		)	(1,854		)	1,592			(1,191		)	401
Securities purchased under agreements to resell(3)	51,187			—			—			51,187			(51,187		)	—
Total		$60,007			($5,374	)		($1,854	)		$52,779			($52,378	)		$401
Liabilities:
Derivatives:
OTC derivatives		($7,029	)		$5,373			$1,601			($55	)		$—			($55	)
Cleared and exchange-traded derivatives	(23		)	1			19			(3		)	—			(3		)
Other	(297		)	—			—			(297		)	—			(297		)
Total derivatives	(7,349		)	5,374			1,620			(355		)	—			(355		)
Securities sold under agreements to repurchase(3)	(8,700		)	—			—			(8,700		)	8,700			—
Total		($16,049	)		$5,374			$1,620			($9,055	)		$8,700			($355	)

Referenced footnotes are included after the next table.

	December 31, 2018
	Gross Amount Recognized			Amount  Offset in the Consolidated Balance Sheets						Net Amount Presented in the Consolidated Balance Sheets			Gross Amount Not Offset in the  Consolidated Balance  Sheets(2)			Net Amount
(In millions)				Counterparty Netting			Cash Collateral Netting(1)
Assets:
Derivatives:
OTC derivatives		$7,213			($4,544	)		($2,448	)		$221			($173	)		$48
Cleared and exchange-traded derivatives	3			—			20			23			—			23
Other	91			—			—			91			—			91
Total derivatives	7,307			(4,544		)	(2,428		)	335			(173		)	162
Securities purchased under agreements to resell(3)	34,771			—			—			34,771			(34,771		)	—
Total		$42,078			($4,544	)		($2,428	)		$35,106			($34,944	)		$162
Liabilities:
Derivatives:
OTC derivatives		($4,963	)		$4,544			$296			($123	)		$—			($123	)
Cleared and exchange-traded derivatives	(244		)	—			101			(143		)	—			(143		)
Other	(317		)	—			—			(317		)	—			(317		)
Total derivatives	(5,524		)	4,544			397			(583		)	—			(583		)
Securities sold under agreements to repurchase(3)	(6,019		)	—			—			(6,019		)	6,019			—
Total		($11,543	)		$4,544			$397			($6,602	)		$6,019			($583	)

(1) Excess cash collateral held is presented as a derivative liability, while excess cash collateral posted is presented as a derivative asset.

(2) Does not include the fair value amount of non-cash collateral posted or held that exceeds the associated net asset or liability, netted by counterparty, presented on the condensed consolidated balance sheets. For cleared and exchange-traded derivatives, does not include non-cash collateral posted by us as initial margin with an aggregate fair value of $4.0 billion and $2.5 billion as of September 30, 2019 and December 31, 2018, respectively.

(3)

Does not include the impacts of netting by central clearing organizations.

Table - Collateral in the Form of Securities Pledged

The tables below summarize the fair value of the securities pledged as collateral by us for derivatives and collateralized borrowing transactions, including securities that the secured party may repledge.

Table 10.2 - Collateral in the Form of Securities Pledged

	September 30, 2019
(In millions)	Derivatives		Securities sold under agreements to repurchase		Other(3)		Total
Cash equivalents(1)		$—		$284		$—		$284
Debt securities of consolidated trusts(2)	747		—		169		916
Available-for-sale securities	—		—		3		3
Trading securities	3,228		8,429		57		11,714
Total securities pledged		$3,975		$8,713		$229		$12,917

	December 31, 2018
(In millions)	Derivatives		Securities sold under agreements to repurchase		Other(3)		Total
Cash equivalents(1)		$—		$2,595		$—		$2,595
Debt securities of consolidated trusts(2)	362		—		179		541
Available-for-sale securities	—		—		1		1
Trading securities	2,160		3,432		73		5,665
Total securities pledged		$2,522		$6,027		$253		$8,802

(1) Represents U.S. Treasury securities accounted for as cash equivalents.

(2) Represents debt securities of consolidated trusts held by us in our Capital Markets segment mortgage investments portfolio which are recorded as a reduction to debt securities of consolidated trusts held by third parties on our condensed consolidated balance sheets.

(3)

Includes other collateralized borrowings and collateral related to transactions with certain clearinghouses.

Table - Underlying Collateral Pledged

The table below summarizes the underlying collateral pledged and the remaining contractual maturity of our gross obligations under securities sold under agreements to repurchase.

Table 10.3 - Underlying Collateral Pledged

	September 30, 2019
(In millions)	Overnight and continuous		30 days or less		After 30 days through 90 days		Greater than 90 days		Total
U.S. Treasury securities and other		$2,684		$5,112		$917		$—		$8,713

XML

Fair Value Disclosures (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Table - Assets and Liabilities Measured at Fair Value on a Recurring Basis

The tables below present our assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis subsequent to initial recognition, including instruments where we have elected the fair value option.

Table 15.1 - Assets and Liabilities Measured at Fair Value on a Recurring Basis

	September 30, 2019
(In millions)	Level 1		Level 2		Level 3		Netting Adjustment(1)			Total
Assets:
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$—		$23,969		$2,150		$—			$26,119
Other agency	—		992		34		—			1,026
Non-agency and other	—		21		1,367		—			1,388
Total available-for-sale securities, at fair value	—		24,982		3,551		—			28,533
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	—		10,042		2,930		—			12,972
Other agency	—		7,189		5		—			7,194
All other	—		—		1		—			1
Total mortgage-related securities	—		17,231		2,936		—			20,167
Non-mortgage-related securities	21,952		2,330		—		—			24,282
Total trading securities, at fair value	21,952		19,561		2,936		—			44,449
Total investments in securities	21,952		44,543		6,487		—			72,982
Mortgage loans:
Held-for-sale, at fair value	—		21,538		—		—			21,538
Derivative assets, net:
Interest-rate swaps	—		2,504		—		—			2,504
Option-based derivatives	—		5,196		—		—			5,196
Other	—		192		16		—			208
Subtotal, before netting adjustments	—		7,892		16		—			7,908
Netting adjustments(1)	—		—		—		(6,316		)	(6,316		)
Total derivative assets, net	—		7,892		16		(6,316		)	1,592
Other assets:
Guarantee asset, at fair value	—		—		4,225		—			4,225
Non-derivative held-for-sale purchase commitments, at fair value	—		223		—		—			223
All other, at fair value	—		—		142		—			142
Total other assets	—		223		4,367		—			4,590
Total assets carried at fair value on a recurring basis		$21,952		$74,196		$10,870		($6,316	)		$100,702
Liabilities:
Debt securities of consolidated trusts held by third parties, at fair value		$—		$4		$733		$—			$737
Other debt, at fair value	—		3,733		130		—			3,863
Derivative liabilities, net:
Interest-rate swaps	—		6,102		—		—			6,102
Option-based derivatives	—		78		—		—			78
Other	—		257		40		—			297
Subtotal, before netting adjustments	—		6,437		40		—			6,477
Netting adjustments(1)	—		—		—		(6,122		)	(6,122		)
Total derivative liabilities, net	—		6,437		40		(6,122		)	355
Other liabilities:
Non-derivative held-for-sale purchase commitments, at fair value	—		1		—		—			1
All other, at fair value	—		—		2		—			2
Total liabilities carried at fair value on a recurring basis		$—		$10,175		$905		($6,122	)		$4,958

Referenced footnote is included after the next table.

	December 31, 2018
(In millions)	Level 1		Level 2		Level 3		Netting Adjustment(1)			Total
Assets:
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$—		$26,102		$4,097		$—			$30,199
Other agency	—		1,668		38		—			1,706
Non-agency and other	—		18		1,640		—			1,658
Total available-for-sale securities, at fair value	—		27,788		5,775		—			33,563
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	—		10,535		3,286		—			13,821
Other agency	—		2,544		7		—			2,551
All other	—		—		1		—			1
Total mortgage-related securities	—		13,079		3,294		—			16,373
Non-mortgage-related securities	15,885		3,290		—		—			19,175
Total trading securities, at fair value	15,885		16,369		3,294		—			35,548
Total investments in securities	15,885		44,157		9,069		—			69,111
Mortgage loans:
Held-for-sale, at fair value	—		23,106		—		—			23,106
Derivative assets, net:
Interest-rate swaps	—		2,127		—		—			2,127
Option-based derivatives	—		4,200		—		—			4,200
Other	—		90		1		—			91
Subtotal, before netting adjustments	—		6,417		1		—			6,418
Netting adjustments(1)	—		—		—		(6,083		)	(6,083		)
Total derivative assets, net	—		6,417		1		(6,083		)	335
Other assets:
Guarantee asset, at fair value	—		—		3,633		—			3,633
Non-derivative held-for-sale purchase commitments, at fair value	—		159		—		—			159
All other, at fair value	—		—		137		—			137
Total other assets	—		159		3,770		—			3,929
Total assets carried at fair value on a recurring basis		$15,885		$73,839		$12,840		($6,083	)		$96,481
Liabilities:
Debt securities of consolidated trusts held by third parties, at fair value		$—		$27		$728		$—			$755
Other debt, at fair value	—		4,223		134		—			4,357
Derivative liabilities, net:
Interest-rate swaps	—		3,974		—		—			3,974
Option-based derivatives	—		137		—		—			137
Other	—		225		92		—			317
Subtotal, before netting adjustments	—		4,336		92		—			4,428
Netting adjustments(1)	—		—		—		(3,845		)	(3,845		)
Total derivative liabilities, net	—		4,336		92		(3,845		)	583
Other liabilities:
Non-derivative held-for-sale purchase commitments, at fair value	—		17		—		—			17
Total liabilities carried at fair value on a recurring basis		$—		$8,603		$954		($3,845	)		$5,712

(1)

Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

Table - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs

The tables below present a reconciliation of all assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis using significant unobservable inputs (Level 3), including transfers into and out of Level 3. The tables also present gains and losses due to changes in fair value, including both realized and unrealized gains and losses, recognized on our condensed consolidated statements of comprehensive income for Level 3 assets and liabilities.

Table 15.2 - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs

	3Q 2019
	Balance, July 1, 2019		Realized and unrealized gains (losses)									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$2,744		$23			$16			$39			$—		$—		($531	)		($102	)		$—		$—			$2,150		$1
Other agency	36		—			—			—			—		—		—			(2		)	—		—			34		—
Non-agency and other	1,494		26			(10		)	16			—		—		(87		)	(56		)	—		—			1,367		3
Total available-for-sale mortgage-related securities	4,274		49			6			55			—		—		(618		)	(160		)	—		—			3,551		4
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,028		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,930		(31		)
Other agency	5		—			—			—			—		—		—			—			—		—			5		—
All other	1		—			—			—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,034		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,936		(31		)
Other assets:
Guarantee asset	3,941		15			—			15			—		439		—			(170		)	—		—			4,225		15
All other, at fair value	126		12			—			12			24		12		(27		)	(5		)	—		—			142		(3		)
Total other assets		$4,067		$27			$—			$27			$24		$451		($27	)		($175	)		$—		$—			$4,367		$12
	Balance, July 1, 2019		Realized and unrealized (gains) losses									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733		$—			$—			$—			$—		$—		$—			$—			$—		$—			$733		$—
Other debt, at fair value	129		—			—			—			2		—		—			(1		)	—		—			130		—
Net derivatives(2)	40		(8		)	—			(8		)	—		—		—			(8		)	—		—			24		(13		)
All other, at fair value	—		2			—			2			2		—		(2		)	—			—		—			2		—

Referenced footnotes are included after the prior period tables.

	YTD 2019
	Balance, January 1, 2019		Realized and unrealized gains (losses)								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income		Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$4,097		$13			$115		$128			$202		$—		($1,724	)		($290	)		$—		($263	)		$2,150		$2
Other agency	38		—			1		1			—		—		—			(5		)	—		—			34		—
Non-agency and other	1,640		52			25		77			—		—		(174		)	(176		)	—		—			1,367		12
Total available-for-sale mortgage-related securities	5,775		65			141		206			202		—		(1,898		)	(471		)	—		(263		)	3,551		14
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,286		(113		)	—		(113		)	1,242		—		(730		)	95			8		(858		)	2,930		(68		)
Other agency	7		—			—		—			—		—		(2		)	—			—		—			5		(1		)
All other	1		—			—		—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,294		(113		)	—		(113		)	1,242		—		(732		)	95			8		(858		)	2,936		(69		)
Other assets:
Guarantee asset	3,633		75			—		75			—		1,005		—			(488		)	—		—			4,225		75
All other, at fair value	137		(31		)	—		(31		)	75		29		(59		)	(9		)	—		—			142		(51		)
Total other assets		$3,770		$44			$—		$44			$75		$1,034		($59	)		($497	)		$—		$—			$4,367		$24
	Balance, January 1, 2019		Realized and unrealized (gains) losses								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income		Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728		$5			$—		$5			$—		$—		$—			$—			$—		$—			$733		$5
Other debt, at fair value	134		—			—		—			—		2		—			(6		)	—		—			130		—
Net derivatives(2)	91		(54		)	—		(54		)	—		—		—			(13		)	—		—			24		(66		)
All other, at fair value	—		—			—		—			4		—		(2		)	—			—		—			2		(2		)

Referenced footnotes are included after the prior period tables.

	3Q 2018
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,004		($3	)		($68	)		($71	)		$684			$—			($237	)		($199	)		$—		($91	)		$6,090		($4	)
Other agency	270		—			—			—			—			—			—			(2		)	—		(228		)	40		—
Non-agency and other	2,535		383			(66		)	317			—			—			(660		)	(134		)	—		—			2,058		10
Total available-for-sale mortgage-related securities	8,809		380			(134		)	246			684			—			(897		)	(335		)	—		(319		)	8,188		6
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,711		(140		)	—			(140		)	623			—			(875		)	(31		)	—		(108		)	3,180		(136		)
Other agency	17		(1		)	—			(1		)	—			—			—			1			—		—			17		(1		)
All other	1		—			—			—			—			—			—			—			—		—			1		—
Total trading mortgage-related securities	3,729		(141		)	—			(141		)	623			—			(875		)	(30		)	—		(108		)	3,198		(137		)
Other assets:
Guarantee asset	3,363		(28		)	—			(28		)	—			255			—			(147		)	—		—			3,443		(28		)
All other, at fair value	103		1			—			1			(3		)	(11		)	—			—			—		—			90		(4		)
Total other assets		$3,466		($27	)		$—			($27	)		($3	)		$244			$—			($147	)		$—		$—			$3,533		($32	)
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$629		($1	)		$—			($1	)		$—			$100			$—			$—			$—		$—			$728		($1	)
Other debt, at fair value	135		—			—			—			—			—			—			(1		)	—		—			134		—
Net derivatives(2)	42		8			—			8			—			41			—			(4		)	—		—			87		3

Referenced footnotes are included after the following table.

	YTD 2018
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,751		($13	)		($267	)		($280	)		$684		$—			($293	)		($772	)		$—		$—			$6,090		($13	)
Other agency	46		—			(1		)	(1		)	—		—			—			(5		)	—		—			40		—
Non-agency and other	4,291		876			(538		)	338			—		—			(2,160		)	(411		)	—		—			2,058		31
Total available-for-sale mortgage-related securities	11,088		863			(806		)	57			684		—			(2,453		)	(1,188		)	—		—			8,188		18
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	2,907		(383		)	—			(383		)	1,027		—			(863		)	(55		)	579		(32		)	3,180		(362		)
Other agency	9		(2		)	—			(2		)	30		—			(21		)	1			—		—			17		(2		)
All other	1		—			—			—			—		—			—			—			—		—			1		—
Total trading mortgage-related securities	2,917		(385		)	—			(385		)	1,057		—			(884		)	(54		)	579		(32		)	3,198		(364		)
Other assets:
Guarantee asset	3,171		(48		)	—			(48		)	—		745			—			(425		)	—		—			3,443		(48		)
All other, at fair value	45		31			—			31			38		(24		)	—			—			—		—			90		11
Total other assets		$3,216		($17	)		$—			($17	)		$38		$721			$—			($425	)		$—		$—			$3,533		($37	)
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$630		($2	)		$—			($2	)		$—		$100			$—			$—			$—		$—			$728		($2	)
Other debt, at fair value	137		—			—			—			—		—			—			(3		)	—		—			134		—
Net derivatives(2)	57		28			—			28			—		15			—			(13		)	—		—			87		15

(1) Transfers out of Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to an increased volume and level of activity in the market and availability of price quotes from dealers and third-party pricing services. Certain Freddie Mac securities are classified as Level 3 at issuance and generally are classified as Level 2 when they begin trading. Transfers into Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to a decrease in market activity and the availability of relevant price quotes from dealers and third-party pricing services.

(2) Amounts are the net of derivative assets and liabilities prior to counterparty netting, cash collateral netting, net trade/settle receivable or payable, and net derivative interest receivable or payable.

(3)

Represents the amount of total gains or losses for the period, included in earnings, attributable to the change in unrealized gains and losses related to assets and liabilities classified as Level 3 that were still held at September 30, 2019 and September 30, 2018, respectively. Included in these amounts are other-than temporary impairments recorded on available-for-sale securities.

Table - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs

The tables below present a reconciliation of all assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis using significant unobservable inputs (Level 3), including transfers into and out of Level 3. The tables also present gains and losses due to changes in fair value, including both realized and unrealized gains and losses, recognized on our condensed consolidated statements of comprehensive income for Level 3 assets and liabilities.

Table 15.2 - Fair Value Measurements of Assets and Liabilities Using Significant Unobservable Inputs

	3Q 2019
	Balance, July 1, 2019		Realized and unrealized gains (losses)									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$2,744		$23			$16			$39			$—		$—		($531	)		($102	)		$—		$—			$2,150		$1
Other agency	36		—			—			—			—		—		—			(2		)	—		—			34		—
Non-agency and other	1,494		26			(10		)	16			—		—		(87		)	(56		)	—		—			1,367		3
Total available-for-sale mortgage-related securities	4,274		49			6			55			—		—		(618		)	(160		)	—		—			3,551		4
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,028		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,930		(31		)
Other agency	5		—			—			—			—		—		—			—			—		—			5		—
All other	1		—			—			—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,034		(30		)	—			(30		)	287		—		(21		)	(35		)	—		(299		)	2,936		(31		)
Other assets:
Guarantee asset	3,941		15			—			15			—		439		—			(170		)	—		—			4,225		15
All other, at fair value	126		12			—			12			24		12		(27		)	(5		)	—		—			142		(3		)
Total other assets		$4,067		$27			$—			$27			$24		$451		($27	)		($175	)		$—		$—			$4,367		$12
	Balance, July 1, 2019		Realized and unrealized (gains) losses									Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733		$—			$—			$—			$—		$—		$—			$—			$—		$—			$733		$—
Other debt, at fair value	129		—			—			—			2		—		—			(1		)	—		—			130		—
Net derivatives(2)	40		(8		)	—			(8		)	—		—		—			(8		)	—		—			24		(13		)
All other, at fair value	—		2			—			2			2		—		(2		)	—			—		—			2		—

Referenced footnotes are included after the prior period tables.

	YTD 2019
	Balance, January 1, 2019		Realized and unrealized gains (losses)								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income		Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$4,097		$13			$115		$128			$202		$—		($1,724	)		($290	)		$—		($263	)		$2,150		$2
Other agency	38		—			1		1			—		—		—			(5		)	—		—			34		—
Non-agency and other	1,640		52			25		77			—		—		(174		)	(176		)	—		—			1,367		12
Total available-for-sale mortgage-related securities	5,775		65			141		206			202		—		(1,898		)	(471		)	—		(263		)	3,551		14
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,286		(113		)	—		(113		)	1,242		—		(730		)	95			8		(858		)	2,930		(68		)
Other agency	7		—			—		—			—		—		(2		)	—			—		—			5		(1		)
All other	1		—			—		—			—		—		—			—			—		—			1		—
Total trading mortgage-related securities	3,294		(113		)	—		(113		)	1,242		—		(732		)	95			8		(858		)	2,936		(69		)
Other assets:
Guarantee asset	3,633		75			—		75			—		1,005		—			(488		)	—		—			4,225		75
All other, at fair value	137		(31		)	—		(31		)	75		29		(59		)	(9		)	—		—			142		(51		)
Total other assets		$3,770		$44			$—		$44			$75		$1,034		($59	)		($497	)		$—		$—			$4,367		$24
	Balance, January 1, 2019		Realized and unrealized (gains) losses								Purchases		Issues		Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2019		Unrealized (gains) losses still held(3)
			Included in earnings			Included in other comprehensive income		Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728		$5			$—		$5			$—		$—		$—			$—			$—		$—			$733		$5
Other debt, at fair value	134		—			—		—			—		2		—			(6		)	—		—			130		—
Net derivatives(2)	91		(54		)	—		(54		)	—		—		—			(13		)	—		—			24		(66		)
All other, at fair value	—		—			—		—			4		—		(2		)	—			—		—			2		(2		)

Referenced footnotes are included after the prior period tables.

	3Q 2018
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,004		($3	)		($68	)		($71	)		$684			$—			($237	)		($199	)		$—		($91	)		$6,090		($4	)
Other agency	270		—			—			—			—			—			—			(2		)	—		(228		)	40		—
Non-agency and other	2,535		383			(66		)	317			—			—			(660		)	(134		)	—		—			2,058		10
Total available-for-sale mortgage-related securities	8,809		380			(134		)	246			684			—			(897		)	(335		)	—		(319		)	8,188		6
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	3,711		(140		)	—			(140		)	623			—			(875		)	(31		)	—		(108		)	3,180		(136		)
Other agency	17		(1		)	—			(1		)	—			—			—			1			—		—			17		(1		)
All other	1		—			—			—			—			—			—			—			—		—			1		—
Total trading mortgage-related securities	3,729		(141		)	—			(141		)	623			—			(875		)	(30		)	—		(108		)	3,198		(137		)
Other assets:
Guarantee asset	3,363		(28		)	—			(28		)	—			255			—			(147		)	—		—			3,443		(28		)
All other, at fair value	103		1			—			1			(3		)	(11		)	—			—			—		—			90		(4		)
Total other assets		$3,466		($27	)		$—			($27	)		($3	)		$244			$—			($147	)		$—		$—			$3,533		($32	)
	Balance, July 1, 2018		Realized and unrealized gains (losses)									Purchases			Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$629		($1	)		$—			($1	)		$—			$100			$—			$—			$—		$—			$728		($1	)
Other debt, at fair value	135		—			—			—			—			—			—			(1		)	—		—			134		—
Net derivatives(2)	42		8			—			8			—			41			—			(4		)	—		—			87		3

Referenced footnotes are included after the following table.

	YTD 2018
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
(In millions)			Included in earnings			Included in other comprehensive income			Total
Assets
Investments in securities:
Available-for-sale, at fair value:
Mortgage-related securities:
Freddie Mac		$6,751		($13	)		($267	)		($280	)		$684		$—			($293	)		($772	)		$—		$—			$6,090		($13	)
Other agency	46		—			(1		)	(1		)	—		—			—			(5		)	—		—			40		—
Non-agency and other	4,291		876			(538		)	338			—		—			(2,160		)	(411		)	—		—			2,058		31
Total available-for-sale mortgage-related securities	11,088		863			(806		)	57			684		—			(2,453		)	(1,188		)	—		—			8,188		18
Trading, at fair value:
Mortgage-related securities:
Freddie Mac	2,907		(383		)	—			(383		)	1,027		—			(863		)	(55		)	579		(32		)	3,180		(362		)
Other agency	9		(2		)	—			(2		)	30		—			(21		)	1			—		—			17		(2		)
All other	1		—			—			—			—		—			—			—			—		—			1		—
Total trading mortgage-related securities	2,917		(385		)	—			(385		)	1,057		—			(884		)	(54		)	579		(32		)	3,198		(364		)
Other assets:
Guarantee asset	3,171		(48		)	—			(48		)	—		745			—			(425		)	—		—			3,443		(48		)
All other, at fair value	45		31			—			31			38		(24		)	—			—			—		—			90		11
Total other assets		$3,216		($17	)		$—			($17	)		$38		$721			$—			($425	)		$—		$—			$3,533		($37	)
	Balance, January 1, 2018		Realized and unrealized gains (losses)									Purchases		Issues			Sales			Settlements, net			Transfers into Level 3(1)		Transfers out of Level 3(1)			Balance, September 30, 2018		Unrealized gains (losses) still held(3)
			Included in earnings			Included in other comprehensive income			Total
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$630		($2	)		$—			($2	)		$—		$100			$—			$—			$—		$—			$728		($2	)
Other debt, at fair value	137		—			—			—			—		—			—			(3		)	—		—			134		—
Net derivatives(2)	57		28			—			28			—		15			—			(13		)	—		—			87		15

(1) Transfers out of Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to an increased volume and level of activity in the market and availability of price quotes from dealers and third-party pricing services. Certain Freddie Mac securities are classified as Level 3 at issuance and generally are classified as Level 2 when they begin trading. Transfers into Level 3 during 3Q 2019 and YTD 2019 and 3Q 2018 and YTD 2018 consisted primarily of certain mortgage-related securities due to a decrease in market activity and the availability of relevant price quotes from dealers and third-party pricing services.

(2) Amounts are the net of derivative assets and liabilities prior to counterparty netting, cash collateral netting, net trade/settle receivable or payable, and net derivative interest receivable or payable.

(3)

Represents the amount of total gains or losses for the period, included in earnings, attributable to the change in unrealized gains and losses related to assets and liabilities classified as Level 3 that were still held at September 30, 2019 and September 30, 2018, respectively. Included in these amounts are other-than temporary impairments recorded on available-for-sale securities.

Table - Quantitative Information about Recurring Level 3 Fair Value Measurements

The tables below provide valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 3 assets and liabilities measured on our condensed consolidated balance sheets at fair value on a recurring basis.

Table 15.3 - Quantitative Information about Recurring Level 3 Fair Value Measurements

	September 30, 2019
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Assets
Available-for-sale, at fair value
Mortgage-related securities
Freddie Mac		$2,150	Discounted cash flows	OAS	30 - 261 bps	81 bps
Non-agency and other	979		Median of external sources	External pricing sources	$70.3 - $76.7		$73.5
	388		Other
Trading, at fair value
Mortgage-related securities
Freddie Mac	2,047		Single external source	External pricing sources	$0.0 - $102.4		$36.1
	883		Discounted cash flows	OAS	(831) - 8,095 bps	555 bps
Guarantee asset, at fair value	3,970		Discounted cash flows	OAS	17-186 bps	43 bps
	255		Other
Insignificant Level 3 assets(1)	182
Total level 3 assets		$10,854
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$733	Single External Source	External Pricing Sources	$99.5 - $103.9		$100.4
Insignificant Level 3 liabilities(1)	156

Referenced footnote is included after the next table.

	December 31, 2018
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Assets
Available-for-sale, at fair value
Mortgage-related securities
Freddie Mac		$2,838	Discounted cash flows	OAS	30 - 325 bps	81 bps
	1,259		Single external source	External pricing sources	$96.1 - $104.1		$102.3
Non-agency and other	1,403		Median of external sources	External pricing sources	$64.3 - $71.1		$67.3
	237		Single external source	External pricing sources	$93.1 - $110.7		$100.7
Trading, at fair value
Mortgage-related securities
Freddie Mac	1,587		Single external source	External pricing sources	$0.0 - $99.2		$56.6
	1,178		Discounted cash flows	OAS	(21,945) - 6,639 bps	90 bps
	521		Other
Guarantee asset, at fair value	3,391		Discounted cash flows	OAS	17-198 bps	49 bps
	242		Other
Insignificant Level 3 assets(1)	184
Total level 3 assets		$12,840
Liabilities
Debt securities of consolidated trusts held by third parties, at fair value		$728	Single External Source	External Pricing Sources	$97.4 - $101.1		$99.6
Insignificant Level 3 liabilities(1)	226

(1)

Represents the aggregate amount of Level 3 assets or liabilities measured at fair value on a recurring basis that are individually and in the aggregate insignificant.

Table - Assets Measured at Fair Value on a Nonrecurring Basis

The table below presents assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 15.4 - Assets Measured at Fair Value on a Non-Recurring Basis

September 30, 2019

December 31, 2018

(In millions)

Level 1

Level 2

Level 3

Total

Level 1

Level 2

Level 3

Total

Assets measured at fair value on a non-recurring basis:

Mortgage loans(1)

$—

$429

$3,301

$3,730

$—

$24

$7,519

$7,543

(1)

Includes loans that are classified as held-for-investment and have been measured for impairment based on the fair value of the underlying collateral and held-for-sale loans where the fair value is below cost.

Table - Fair Value Assets Measured on Nonrecurring Basis Valuation Techniques

The tables below provide valuation techniques, the range, and the weighted average of significant unobservable inputs for Level 3 assets measured on our condensed consolidated balance sheets at fair value on a non-recurring basis.

Table 15.5 - Quantitative Information about Non-Recurring Level 3 Fair Value Measurements

	September 30, 2019
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Non-recurring fair value measurements
Mortgage loans		$3,301
			Internal model	Historical sales proceeds	$3,110 - $671,825	$185,551
			Internal model	Housing sales index	45 - 352 bps	113 bps
			Median of external sources	External pricing sources	$30.4 - $95.0	$85.1
	December 31, 2018
	Level 3 Fair Value		Predominant Valuation Technique(s)	Unobservable Inputs
(Dollars in millions, except for certain unobservable inputs as shown)				Type	Range	Weighted Average
Non-recurring fair value measurements
Mortgage loans		$7,519
			Internal model	Historical sales proceeds	$3,000 - $750,500	$177,725
			Internal model	Housing sales index	44 - 480 bps	108 bps
			Median of external sources	External pricing sources	$36.2 - $94.6	$82.5

Table - Fair Value of Financial Instruments

The tables below present the carrying value and estimated fair value of our financial instruments. For certain types of financial instruments, such as cash and cash equivalents, securities purchased under agreements to resell, secured lending and other, and certain debt, the carrying value on our GAAP balance sheets approximates fair value, as these assets and liabilities are short-term in nature and have limited fair value volatility.

Table 15.6 - Fair Value of Financial Instruments

		September 30, 2019
	GAAP Measurement Category(1)	GAAP Carrying  Amount		Fair Value
(In millions)				Level 1		Level 2		Level 3		Netting  Adjustments(2)			Total
Financial Assets
Cash and cash equivalents	Amortized cost		$8,708		$8,693		$15		$—		$—			$8,708
Securities purchased under agreements to resell	Amortized cost	51,187		—		51,187		—		—			51,187
Investments in securities:
Available-for-sale, at fair value	FV - OCI	28,533		—		24,982		3,551		—			28,533
Trading, at fair value	FV - NI	44,449		21,952		19,561		2,936		—			44,449
Total investments in securities		72,982		21,952		44,543		6,487		—			72,982
Mortgage loans:
Loans held by consolidated trusts		1,905,633		—		1,714,292		223,324		—			1,937,616
Loans held by Freddie Mac		91,857		—		46,636		48,517		—			95,153
Total mortgage loans	Various(3)	1,997,490		—		1,760,928		271,841		—			2,032,769
Derivative assets, net	FV - NI	1,592		—		7,892		16		(6,316		)	1,592
Guarantee asset	FV - NI	4,225		—		—		4,233		—			4,233
Non-derivative purchase commitments, at fair value	FV - NI	223		—		229		1		—			230
Secured lending and other	Amortized cost	5,439		—		1,728		2,745		—			4,473
Total financial assets			$2,141,846		$30,645		$1,866,522		$285,323		($6,316	)		$2,176,174
Financial Liabilities
Debt, net:
Debt securities of consolidated trusts held by third parties			$1,869,308		$—		$1,898,887		$2,068		$—			$1,900,955
Other debt		279,951		—		281,229		3,757		—			284,986
Total debt, net	Various(4)	2,149,259		—		2,180,116		5,825		—			2,185,941
Derivative liabilities, net	FV - NI	355		—		6,437		40		(6,122		)	355
Guarantee obligation	Amortized cost	4,055		—		—		4,416		—			4,416
Non-derivative purchase commitments, at fair value	FV - NI	1		—		1		12		—			13
Total financial liabilities			$2,153,670		$—		$2,186,554		$10,293		($6,122	)		$2,190,725

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

(3) As of September 30, 2019, the GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $2.0 trillion, $19.6 billion, and $21.5 billion, respectively.

(4) As of September 30, 2019, the GAAP carrying amounts measured at amortized cost and FV - NI were $2.1 trillion and $4.6 billion, respectively.

		December 31, 2018
	GAAP Measurement Category(1)	GAAP Carrying  Amount		Fair Value
(In millions)				Level 1		Level 2		Level 3		Netting Adjustments(2)			Total
Financial Assets
Cash and cash equivalents	Amortized cost		$7,273		$7,273		$—		$—		$—			$7,273
Securities purchased under agreements to resell	Amortized cost	34,771		—		34,771		—		—			34,771
Investments in securities:
Available-for-sale, at fair value	FV - OCI	33,563		—		27,788		5,775		—			33,563
Trading, at fair value	FV - NI	35,548		15,885		16,369		3,294		—			35,548
Total investments in securities		69,111		15,885		44,157		9,069		—			69,111
Mortgage loans:
Loans held by consolidated trusts		1,842,850		—		1,605,874		209,542		—			1,815,416
Loans held by Freddie Mac		84,128		—		33,946		52,212		—			86,158
Total mortgage loans	Various(3)	1,926,978		—		1,639,820		261,754		—			1,901,574
Derivative assets, net	FV - NI	335		—		6,417		1		(6,083		)	335
Guarantee asset	FV - NI	3,633		—		—		3,642		—			3,642
Non-derivative purchase commitments, at fair value	FV - NI	159		—		159		2		—			161
Secured lending and other	Amortized cost	1,805		—		195		873		—			1,068
Total financial assets			$2,044,065		$23,158		$1,725,519		$275,341		($6,083	)		$2,017,935
Financial Liabilities
Debt, net:
Debt securities of consolidated trusts held by third parties			$1,792,677		$—		$1,759,911		$2,698		$—			$1,762,609
Other debt		252,273		—		251,543		3,629		—			255,172
Total debt, net	Various(4)	2,044,950		—		2,011,454		6,327		—			2,017,781
Derivative liabilities, net	FV - NI	583		—		4,336		92		(3,845		)	583
Guarantee obligation	Amortized cost	3,561		—		—		4,146		—			4,146
Non-derivative purchase commitments, at fair value	FV - NI	17		—		17		11		—			28
Total financial liabilities			$2,049,111		$—		$2,015,807		$10,576		($3,845	)		$2,022,538

(1) FV - NI denotes fair value through net income. FV - OCI denotes fair value through other comprehensive income.

(2) Represents counterparty netting, cash collateral netting, and net derivative interest receivable or payable.

(3) As of December 31, 2018, the GAAP carrying amounts measured at amortized cost, lower-of-cost-or-fair-value, and FV - NI were $1.9 trillion, $18.5 billion, and $23.1 billion, respectively.

(4)

As of December 31, 2018, the GAAP carrying amounts measured at amortized cost and FV - NI were $2.0 trillion and $5.1 billion, respectively.

Table - Difference between Fair Value and UPB for Certain Financial Instruments with Fair Value Option Elected

The table below presents the fair value and UPB related to certain loans and long-term debt for which we have elected the fair value option. This table does not include interest-only securities related to debt securities of consolidated trusts and other debt held by third parties with a fair value of $61 million and $26 million and multifamily held-for-sale loan purchase commitments with a fair value of $222 million and $142 million, as of September 30, 2019 and December 31, 2018, respectively.

Table 15.7 - Difference between Fair Value and UPB for Certain Financial Instruments with Fair Value Option Elected

	September 30, 2019						December 31, 2018
(In millions)	Multifamily Held-For-Sale  Loans		Other Debt - Long Term		Debt Securities Of Consolidated Trusts Held By Third Parties		Multifamily Held-For-Sale  Loans		Other Debt - Long Term		Debt Securities Of Consolidated Trusts Held By Third Parties
Fair value		$21,538		$3,806		$733		$23,106		$4,357		$728
UPB	20,152		3,538		730		22,693		3,998		730
Difference		$1,386		$268		$3		$413		$359		($2	)

The table below presents the changes in fair value included in non-interest income (loss) in our condensed consolidated statements of comprehensive income, related to items for which we have elected the fair value option.

Table 15.8 - Changes in Fair Value Under the Fair Value Option Election

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(In millions)	Gains (Losses)						Gains (Losses)
Multifamily held-for-sale loans		$398			($285	)		$1,216			($797	)
Multifamily held-for-sale loan purchase commitments	641			267			1,644			564
Other debt - long term	49			10			116			38
Debt securities of consolidated trusts held by third parties	(1		)	2			(6		)	4

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Debt Securities and Subordinated Borrowings

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

DEBT SECURITIES AND SUBORDINATED BORROWINGS

Debt Securities and Subordinated Borrowings

The table below summarizes the balances of total debt, net per our condensed consolidated balance sheets and the interest expense per our condensed consolidated statements of comprehensive income.

Table 8.1 - Total Debt, Net

	Balance, Net				Interest Expense
(In millions)	September 30, 2019		December 31, 2018		3Q 2019		3Q 2018		YTD 2019		YTD 2018
Debt securities of consolidated trusts held by third parties		$1,869,308		$1,792,677		$13,324		$12,827		$41,001		$37,996
Other debt:
Short-term debt	94,344		51,080		499		361		1,419		832
Long-term debt	185,607		201,193		1,307		1,358		4,078		3,974
Total other debt	279,951		252,273		1,806		1,719		5,497		4,806
Total debt, net		$2,149,259		$2,044,950		$15,130		$14,546		$46,498		$42,802

As of September 30, 2019, our aggregate indebtedness was $282.3 billion, which was below the $300.0 billion debt cap limit imposed by the Purchase Agreement for 2019. Our aggregate indebtedness calculation primarily includes the par value of other short- and long-term debt.

Debt Securities of Consolidated Trusts Held by Third Parties

The table below summarizes the debt securities of consolidated trusts held by third parties based on underlying loan product type.

Table 8.2 - Debt Securities of Consolidated Trusts Held by Third Parties

	September 30, 2019							December 31, 2018
(Dollars in millions)	Contractual Maturity	UPB		Carrying Amount(1)		Weighted Average Coupon(2)		Contractual Maturity	UPB		Carrying Amount(1)		Weighted Average Coupon(2)
Single-family:
30-year or more, fixed-rate	2019 - 2057		$1,487,105		$1,525,505	3.69	%	2019 - 2057		$1,389,113		$1,426,060	3.72	%
20-year fixed-rate	2019 - 2039	69,068		70,764		3.42		2019 - 2039	70,547		72,354		3.43
15-year fixed-rate	2019 - 2034	224,190		227,915		2.89		2019 - 2034	240,310		244,587		2.89
Adjustable-rate	2019 - 2049	32,837		33,474		3.28		2019 - 2049	38,361		39,153		3.12
Interest-only	2026 - 2041	4,608		4,677		4.72		2026 - 2048	5,322		5,386		4.41
FHA/VA	2020 - 2049	665		680		4.69		2019 - 2046	720		736		4.78
Total single-family		1,818,473		1,863,015					1,744,373		1,788,276
Multifamily	2020-2049	6,233		6,293		3.14		2019 - 2047	4,365		4,401		4.02
Total debt securities of consolidated trusts held by third parties			$1,824,706		$1,869,308					$1,748,738		$1,792,677

(1) Includes $737 million and $755 million at September 30, 2019 and December 31, 2018, respectively, of debt of consolidated trusts that represents the fair value of debt securities with the fair value option elected.

(2)

The effective interest rate for debt securities of consolidated trusts held by third parties was 2.81% and 3.07% as of September 30, 2019 and December 31, 2018, respectively.

Other Debt

The table below summarizes the balances and effective interest rates for other debt.

Table 8.3 - Total Other Debt

	September 30, 2019						December 31, 2018
(Dollars in millions)	Par Value		Carrying Amount(1)		Weighted Average Effective Rate(2)		Par Value		Carrying Amount(1)			Weighted Average Effective Rate(2)
Other short-term debt:
Discount notes and Reference Bills		$42,719		$42,550	2.09	%		$28,787		$28,621		2.36	%
Medium-term notes	43,098		43,094		2.34		16,440		16,440			2.10
Securities sold under agreements to repurchase	8,700		8,700		2.06		6,019		6,019			2.40
Total other short-term debt	94,517		94,344		2.20		51,246		51,080			2.28
Other long-term debt:
Original maturities on or before December 31,
2019	12,442		12,435		1.63		58,002		57,968			1.54
2020	48,348		48,337		2.00		42,296		42,275			1.78
2021	36,669		36,669		2.05		30,898		30,901			2.06
2022	26,044		26,022		2.34		20,802		20,775			2.46
2023	10,064		10,045		2.65		15,929		15,906			3.09
Thereafter	37,392		34,994		3.68		18,068		15,579			5.91
STACR and SCR debt(3)	16,088		16,257		6.03		17,729		18,004			6.04
Hedging-related basis adjustments	N/A		848				N/A		(215		)
Total other long-term debt	187,047		185,607		2.74		203,724		201,193			2.58
Total other debt(4)		$281,564		$279,951				$254,970		$252,273

(1) Represents par value, net of associated discounts or premiums and issuance cost. Includes $3.9 billion and $4.4 billion at September 30, 2019 and December 31, 2018, respectively, of other long-term debt that represents the fair value of debt securities with the fair value option elected.

(2) Based on carrying amount.

(3) Contractual maturities of these debt securities are not presented because they are subject to prepayment risk, as their payments are based upon the performance of a pool of mortgage assets that may be prepaid by the related mortgage borrower at any time generally without penalty.

(4)

Carrying amount for other debt includes callable debt of $105.5 billion and $107.2 billion at September 30, 2019 and December 31, 2018, respectively.

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Mortgage Loans and Loan Loss Reserves

9 Months Ended

Sep. 30, 2019

SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract]

MORTGAGE LOANS AND LOAN LOSS RESERVES

Mortgage Loans and Allowance for Credit Losses

The table below provides details of the loans on our condensed consolidated balance sheets as of September 30, 2019 and December 31, 2018.

Table 4.1 - Mortgage Loans

	September 30, 2019									December 31, 2018
(In millions)	Held by Freddie Mac			Held by Consolidated Trusts			Total			Held by Freddie Mac			Held by Consolidated Trusts			Total
Held-for-sale:
Single-family		$17,249			$—			$17,249			$20,946			$—			$20,946
Multifamily	25,397			—			25,397			23,959			—			23,959
Total UPB	42,646			—			42,646			44,905			—			44,905
Cost basis and fair value adjustments, net	(1,528		)	—			(1,528		)	(3,283		)	—			(3,283		)
Total held-for-sale loans, net	41,118			—			41,118			41,622			—			41,622
Held-for-investment:
Single-family	41,886			1,867,906			1,909,792			35,885			1,814,008			1,849,893
Multifamily	11,291			5,591			16,882			10,828			4,220			15,048
Total UPB	53,177			1,873,497			1,926,674			46,713			1,818,228			1,864,941
Cost basis adjustments	(421		)	34,973			34,552			(1,198		)	27,752			26,554
Allowance for loan losses	(2,017		)	(2,837		)	(4,854		)	(3,009		)	(3,130		)	(6,139		)
Total held-for-investment loans, net	50,739			1,905,633			1,956,372			42,506			1,842,850			1,885,356
Total mortgage loans, net		$91,857			$1,905,633			$1,997,490			$84,128			$1,842,850			$1,926,978

The table below provides details of the UPB of loans we purchased, reclassified from held-for-investment to held-for-sale, and sold.

Table 4.2 - Loans Purchased, Reclassified from Held-for-Investment to Held-for-Sale, and Sold

(In billions)	3Q 2019		3Q 2018		YTD 2019		YTD 2018
Single-family:
Purchases
Held-for-investment loans		$133.8		$81.6		$305.0		$231.5
Reclassified from held-for-investment to held-for-sale (1)	3.0		13.3		8.1		17.6
Sale of held-for-sale loans(2)	3.7		2.3		9.4		6.5
Multifamily:
Purchases
Held-for-investment loans	4.4		0.9		6.8		2.6
Held-for-sale loans	23.1		16.3		50.6		42.5
Reclassified from held-for-investment to held-for-sale (1)	0.4		0.2		1.2		0.7
Sale of held-for-sale loans (3)	19.7		14.4		49.5		44.8

(1) We reclassify loans from held-for-investment to held-for-sale when we no longer have the intent or ability to hold for the foreseeable future. For additional information regarding the fair value of our loans classified as held-for-sale, see Note 15.

(2) Our sales of single-family loans reflect the sale of seasoned single-family mortgage loans. The sale of seasoned single-family mortgage loans is part of our strategy to mitigate and reduce our holdings of less liquid assets.

(3)

Our sales of multifamily loans occur primarily through the issuance of multifamily K Certificates and SB Certificates.

Credit Quality

Single-Family

The current LTV ratio is one key factor we consider when estimating our allowance for credit losses for single-family loans. As current LTV ratios increase, the borrower's equity in the home decreases, which may negatively affect the borrower's ability to refinance (outside of the Enhanced Relief Refinance program) or to sell the property for an amount at or above the balance of the outstanding loan.

A second-lien loan also reduces the borrower's equity in the home, and has a similar negative effect on the borrower's ability to refinance or sell the property for an amount at or above the combined balances of the first and second loans. However, borrowers are free to obtain second-lien financing after origination, and we are not entitled to receive notification when a borrower does so. For further information about concentrations of risk associated with our single-family and multifamily loans, see Note 14.

The table below presents the recorded investment of single-family held-for-investment loans by current LTV ratios. Our current LTV ratios are estimates based on available data through the end of each respective period presented.

Table 4.3 - Recorded Investment of Single-Family Held-for-Investment Loans by Current LTV Ratios

	September 30, 2019								December 31, 2018
	Current LTV Ratio						Total		Current LTV Ratio						Total
(In millions)	≤ 80		> 80 to 100		> 100(1)				≤ 80		> 80 to 100		> 100(1)
20- and 30-year or more, amortizing fixed-rate		$1,388,311		$255,880		$4,689		$1,648,880		$1,336,310		$214,703		$6,654		$1,557,667
15-year amortizing fixed-rate	235,185		5,604		103		240,892		251,152		4,522		157		255,831
Adjustable-rate	37,659		1,660		6		39,325		42,117		1,883		7		44,007
Alt-A, interest-only, and option ARM	13,743		1,198		289		15,230		16,498		1,903		559		18,960
Total single-family loans		$1,674,898		$264,342		$5,087		$1,944,327		$1,646,077		$223,011		$7,377		$1,876,465

(1) The serious delinquency rate for the total of single-family held-for-investment mortgage loans with current LTV ratios in excess of 100% was 5.18% and 7.24% as of September 30, 2019 and December 31, 2018, respectively.

For reporting purposes:

n Loans within the Alt-A category continue to be presented in that category following modification, even though the borrower may have provided full documentation of assets and income to complete the modification and

n

Loans within the option ARM category continue to be presented in that category following modification, even though the modified loan no longer provides for optional payment provisions.

Multifamily

The table below presents the recorded investment in our multifamily held-for-investment loans, by credit quality indicator based on available data through the end of each period presented. These indicators involve significant management judgment.

Table 4.4 - Recorded Investment of Multifamily Held-for-Investment Loans by Credit Quality Indicator

(In millions)	September 30, 2019		December 31, 2018
Credit risk profile by internally assigned grade:(1)
Pass		$16,684		$14,648
Special mention	66		201
Substandard	149		181
Doubtful	—		—
Total		$16,899		$15,030

(1)

A loan categorized as: "Pass" is current and adequately protected by the current financial strength and debt service capacity of the borrower; "Special mention" has administrative issues that may affect future repayment prospects but does not have current credit weaknesses; "Substandard" has a weakness that jeopardizes the timely full repayment; and "Doubtful" has a weakness that makes collection or liquidation in full highly questionable and improbable based on existing conditions.

Mortgage Loan Performance

The tables below present the recorded investment of our single-family and multifamily loans, held-for-investment, by payment status.

Table 4.5 - Recorded Investment of Held-for-Investment Loans by Payment Status

	September 30, 2019
(In millions)	Current		One Month Past Due		Two Months Past Due		Three Months or More Past Due, or in Foreclosure(1)		Total		Non-accrual
Single-family:
20- and 30-year or more, amortizing fixed-rate		$1,624,964		$14,846		$3,495		$5,575		$1,648,880		$5,573
15-year amortizing fixed-rate	239,460		1,025		170		237		240,892		237
Adjustable-rate	38,928		249		53		95		39,325		95
Alt-A, interest-only, and option ARM	13,855		608		228		539		15,230		538
Total single-family	1,917,207		16,728		3,946		6,446		1,944,327		6,443
Total multifamily	16,896		3		—		—		16,899		13
Total single-family and multifamily		$1,934,103		$16,731		$3,946		$6,446		$1,961,226		$6,456
	December 31, 2018
(In millions)	Current		One Month Past Due		Two Months Past Due		Three Months or More Past Due, or in Foreclosure(1)		Total		Non-accrual
Single-family:
20- and 30-year or more, amortizing fixed-rate		$1,532,499		$14,683		$3,602		$6,883		$1,557,667		$6,881
15-year amortizing fixed-rate	254,376		1,021		171		263		255,831		263
Adjustable-rate	43,549		287		58		113		44,007		113
Alt-A, interest-only, and option ARM	16,975		793		327		865		18,960		864
Total single-family	1,847,399		16,784		4,158		8,124		1,876,465		8,121
Total multifamily	15,030		—		—		—		15,030		17
Total single-family and multifamily		$1,862,429		$16,784		$4,158		$8,124		$1,891,495		$8,138

(1)

Includes $1.9 billion and $2.9 billion of single-family loans that were in the process of foreclosure as of September 30, 2019 and December 31, 2018, respectively.

The table below summarizes the delinquency rates of loans within our single-family credit guarantee and multifamily mortgage portfolios.

Table 4.6 - Delinquency Rates

(Dollars in millions)	September 30, 2019			December 31, 2018
Single-family:
Non-credit-enhanced portfolio
Serious delinquency rate	0.72		%	0.83		%
Total number of seriously delinquent loans	42,758			51,197
Credit-enhanced portfolio:(1)
Primary mortgage insurance:
Serious delinquency rate	0.76		%	0.86		%
Total number of seriously delinquent loans	14,358			15,287
Other credit protection:(2)
Serious delinquency rate	0.34		%	0.31		%
Total number of seriously delinquent loans	15,736			12,920
Total single-family:
Serious delinquency rate	0.61		%	0.69		%
Total number of seriously delinquent loans	67,991			75,649
Multifamily: (3)
Non-credit-enhanced portfolio:
Delinquency rate	0.01		%	—		%
UPB of delinquent loans		$3			$2
Credit-enhanced portfolio:
Delinquency rate	0.04		%	0.01		%
UPB of delinquent loans		$103			$28
Total multifamily:
Delinquency rate	0.04		%	0.01		%
UPB of delinquent loans		$106			$30

(1) The credit-enhanced categories are not mutually exclusive, as a single loan may be covered by both primary mortgage insurance and other credit protection.

(2) Consists of single-family loans covered by financial arrangements (other than primary mortgage insurance) that are designed to reduce our credit risk exposure. See Note 6 for additional information on our credit enhancements.

(3)

Multifamily delinquency performance is based on the UPB of loans that are two monthly payments or more past due or those in the process of foreclosure.

Allowance for Credit Losses

The allowance for credit losses represents estimates of probable incurred credit losses which we recognize by recording a charge to the provision for credit losses on our condensed consolidated statements of comprehensive income. The allowance for credit losses includes:

n Our allowance for loan losses, which pertains to all single-family and multifamily loans classified as held-for-investment on our condensed consolidated balance sheets and

n Our reserve for guarantee losses, which pertains to single-family and multifamily loans underlying our senior subordinate securitization structures (non-consolidated), other securitization products, and other mortgage-related guarantees.

Table 4.7 - Details of Allowance for Credit Losses

The table below summarizes changes in our allowance for credit losses.

	3Q 2019												3Q 2018
	Allowance for Loan Losses						Reserve  for Guarantee Losses			Total			Allowance for Loan Losses						Reserve  for Guarantee Losses			Total
(In millions)	Held by Freddie Mac			Held By Consolidated Trusts									Held by Freddie Mac			Held By Consolidated Trusts
Single-family:
Beginning balance		$2,238			$3,042			$46			$5,326			$4,887			$3,497			$49			$8,433
Provision (benefit) for credit losses	(84		)	(97		)	1			(180		)	(522		)	143			1			(378		)
Charge-offs	(394		)	(12		)	(1		)	(407		)	(1,262		)	(13		)	(2		)	(1,277		)
Recoveries	104			3			—			107			117			2			—			119
Transfers, net (1)	103			(103		)	—			—			306			(306		)	—			—
Other (2)	41			—			—			41			76			11			—			87
Single-family ending balance	2,008			2,833			46			4,887			3,602			3,334			48			6,984
Multifamily ending balance	9			4			5			18			8			2			8			18
Total ending balance		$2,017			$2,837			$51			$4,905			$3,610			$3,336			$56			$7,002

	YTD 2019												YTD 2018
	Allowance for Loan Losses						Reserve  for Guarantee Losses			Total			Allowance for Loan Losses						Reserve  for Guarantee Losses			Total
(In millions)	Held by Freddie Mac			Held By Consolidated Trusts									Held by Freddie Mac			Held By Consolidated Trusts
Single-family:
Beginning balance		$3,003			$3,127			$46			$6,176			$5,251			$3,680			$48			$8,979
Provision (benefit) for credit losses	(509		)	29			3			(477		)	(629		)	266			6			(357		)
Charge-offs	(1,208		)	(45		)	(3		)	(1,256		)	(2,198		)	(44		)	(6		)	(2,248		)
Recoveries	331			10			—			341			336			5			—			341
Transfers, net (1)	291			(291		)	—			—			597			(597		)	—			—
Other (2)	100			3			—			103			245			24			—			269
Single-family ending balance	2,008			2,833			46			4,887			3,602			3,334			48			6,984
Multifamily ending balance	9			4			5			18			8			2			8			18
Total ending balance		$2,017			$2,837			$51			$4,905			$3,610			$3,336			$56			$7,002

(1) Relates to removal of delinquent loans from consolidated trusts and resecuritization after such removal. 

(2)

Primarily includes capitalization of past due interest on modified loans.

A significant number of unsecuritized single-family loans on our condensed consolidated balance sheets are individually evaluated for impairment while substantially all single-family loans held by our consolidated trusts are collectively evaluated for impairment. The allowance for loan losses associated with our held-for-investment unsecuritized loans represented approximately 3.8% and 6.6% of the recorded investment in such loans at September 30, 2019 and December 31, 2018, respectively, and a substantial portion of the allowance associated with these loans represented interest rate concessions provided to borrowers as part of loan modifications. The allowance for loan losses associated with loans held by our consolidated trusts represented approximately 0.1% and 0.2% of the recorded investment in such loans as of September 30, 2019 and December 31, 2018, respectively.

The table below presents our allowance for loan losses and our recorded investment in loans, held-for-investment, by impairment evaluation methodology.

Table 4.8 - Net Investment in Loans

	September 30, 2019									December 31, 2018
(In millions)	Single-family			Multifamily			Total			Single-family			Multifamily			Total
Recorded investment:
Collectively evaluated		$1,904,203			$16,818			$1,921,021			$1,830,044			$14,945			$1,844,989
Individually evaluated	40,124			81			40,205			46,421			85			46,506
Total recorded investment	1,944,327			16,899			1,961,226			1,876,465			15,030			1,891,495
Ending balance of the allowance for loan losses:
Collectively evaluated	(1,515		)	(13		)	(1,528		)	(1,761		)	(9		)	(1,770		)
Individually evaluated	(3,326		)	—			(3,326		)	(4,369		)	—			(4,369		)
Total ending balance of the allowance	(4,841		)	(13		)	(4,854		)	(6,130		)	(9		)	(6,139		)
Net investment in loans		$1,939,486			$16,886			$1,956,372			$1,870,335			$15,021			$1,885,356

Allowance for Loan Losses Determined on an Individual Basis

Impaired Loans

The tables below present the UPB, recorded investment, related allowance for loan losses, average recorded investment, and interest income recognized for individually impaired loans.

Table 4.9 - Individually Impaired Loans

	September 30, 2019							December 31, 2018
(In millions)	UPB		Recorded Investment		Associated Allowance			UPB		Recorded Investment		Associated Allowance
Single-family:
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$3,008		$2,390	N/A				$3,335		$2,666	N/A
15-year amortizing fixed-rate	20		20		N/A			23		22		N/A
Adjustable-rate	183		182		N/A			227		226		N/A
Alt-A, interest-only, and option ARM	1,004		853		N/A			1,286		1,083		N/A
Total with no allowance recorded	4,215		3,445		N/A			4,871		3,997		N/A
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	32,441		32,118			($2,784	)	37,579		36,959			($3,660	)
15-year amortizing fixed-rate	641		650		(14		)	703		713		(19		)
Adjustable-rate	133		132		(7		)	164		162		(8		)
Alt-A, interest-only, and option ARM	3,962		3,779		(521		)	4,867		4,590		(682		)
Total with an allowance recorded	37,177		36,679		(3,326		)	43,313		42,424		(4,369		)
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	35,449		34,508		(2,784		)	40,914		39,625		(3,660		)
15-year amortizing fixed-rate	661		670		(14		)	726		735		(19		)
Adjustable-rate	316		314		(7		)	391		388		(8		)
Alt-A, interest-only, and option ARM	4,966		4,632		(521		)	6,153		5,673		(682		)
Total single-family	41,392		40,124		(3,326		)	48,184		46,421		(4,369		)
Multifamily:
With no allowance recorded (1)	87		81		N/A			89		82		N/A
With an allowance recorded	—		—		—			3		3		—
Total multifamily	87		81		—			92		85		—
Total single-family and multifamily		$41,479		$40,205		($3,326	)		$48,276		$46,506		($4,369	)

Referenced footnotes are included after the last table in the Impaired Loans section.

	3Q 2019						3Q 2018
(In millions)	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)
Single-family:
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$2,450		$59		$1		$3,142		$83		$3
15-year amortizing fixed-rate	19		1		—		20		—		—
Adjustable rate	191		3		—		238		3		—
Alt-A, interest-only, and option ARM	880		16		—		1,159		21		1
Total with no allowance recorded	3,540		79		1		4,559		107		4
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	32,618		412		47		42,393		520		52
15-year amortizing fixed-rate	641		5		1		740		7		2
Adjustable rate	129		2		—		183		2		—
Alt-A, interest-only, and option ARM	3,866		55		9		5,622		72		7
Total with an allowance recorded	37,254		474		57		48,938		601		61
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	35,068		471		48		45,535		603		55
15-year amortizing fixed-rate	660		6		1		760		7		2
Adjustable rate	320		5		—		421		5		—
Alt-A, interest-only, and option ARM	4,746		71		9		6,781		93		8
Total single-family	40,794		553		58		53,497		708		65
Multifamily:
With no allowance recorded (1)	81		1		1		112		2		1
With an allowance recorded	—		—		—		3		—		—
Total multifamily	81		1		1		115		2		1
Total single-family and multifamily		$40,875		$554		$59		$53,612		$710		$66

Referenced footnotes are included after the last table in the Impaired Loans section

	YTD 2019						YTD 2018
(In millions)	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized On Cash Basis(3)
Single-family —
With no allowance recorded: (1)
20- and 30-year or more, amortizing fixed-rate		$2,573		$207		$6		$3,399		$268		$13
15-year amortizing fixed-rate	20		1		—		21		3		—
Adjustable rate	209		9		—		255		9		—
Alt-A, interest-only, and option ARM	932		52		1		1,319		68		3
Total with no allowance recorded	3,734		269		7		4,994		348		16
With an allowance recorded: (2)
20- and 30-year or more, amortizing fixed-rate	34,051		1,394		138		46,140		1,621		217
15-year amortizing fixed-rate	665		17		3		830		21		8
Adjustable rate	139		5		1		210		4		2
Alt-A, interest-only, and option ARM	4,097		180		18		6,357		205		24
Total with an allowance recorded	38,952		1,596		160		53,537		1,851		251
Combined single-family:
20- and 30-year or more, amortizing fixed-rate	36,624		1,601		144		49,539		1,889		230
15-year amortizing fixed-rate	685		18		3		851		24		8
Adjustable rate	348		14		1		465		13		2
Alt-A, interest-only, and option ARM	5,029		232		19		7,676		273		27
Total single-family	42,686		1,865		167		58,531		2,199		267
Multifamily:
With no allowance recorded (1)	83		3		1		132		5		2
With an allowance recorded	—		—		—		3		—		—
Total multifamily	83		3		1		135		5		2
Total single-family and multifamily		$42,769		$1,868		$168		$58,666		$2,204		$269

(1) Individually impaired loans with no allowance primarily represent those loans for which the collateral value is sufficiently in excess of the loan balance to result in recovery of the entire recorded investment if the property were foreclosed upon or otherwise subject to disposition.

(2) Consists primarily of loans classified as TDRs.

(3)

Consists of income recognized during the period related to loans on non-accrual status.

Troubled Debt Restructurings (TDRs)

The table below presents the volume of single-family and multifamily loans that were newly classified as TDRs, based on the original product category of the loan before the loan was classified as a TDR. Loans classified as a TDR in one period may be subject to further action (such as a modification or remodification) in a subsequent period. In such cases, the subsequent action would not be reflected in the table below since the loan would already have been classified as a TDR.

Table 4.10 - TDR Activity

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(Dollars in millions)	Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment		Number of  Loans	Post-TDR Recorded Investment
Single-family: (1)
20- and 30-year or more, amortizing fixed-rate	5,908		$998	7,157		$1,091	19,668		$3,262	37,847		$6,159
15-year amortizing fixed-rate	693	69		909	83		2,364	230		5,194	514
Adjustable-rate	128	22		197	27		403	64		773	122
Alt-A, interest-only, and option ARM	285	45		414	65		1,331	190		2,294	379
Total single-family	7,014	1,134		8,677	1,266		23,766	3,746		46,108	7,174
Multifamily	—		$—	—		$—	—		$—	1		$15

(1) The pre-TDR recorded investment for single-family loans initially classified as TDR during 3Q 2019 and YTD 2019 was $1.1 billion and $3.7 billion, respectively, compared to $1.3 billion and $7.2 billion during 3Q 2018 and YTD 2018, respectively.

Of the single-family loan modifications that were classified as TDRs during 3Q 2019, 3Q 2018, YTD 2019 and YTD 2018, respectively:

n 9%, 9%, 8%, and 12% involved interest rate reductions and, in certain cases, term extensions;

n 23%, 21%, 24%, and 24% involved principal forbearance in addition to interest rate reductions and, in certain cases, term extensions;

n The average term extension was 188, 110, 177, and 126 months; and

n The average interest rate reduction was 0.2%, 0.2%, 0.1%, and 0.3%.

The table below presents the volume of our TDR modifications that experienced payment defaults (i.e., loans that became two months delinquent or completed a loss event) during the applicable periods and had completed a modification during the year preceding the payment default. The table presents loans based on their original product category before modification.

Table 4.11 - Payment Defaults of Completed TDR Modifications

	3Q 2019			3Q 2018			YTD 2019			YTD 2018
(Dollars in millions)	Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment		Number of Loans	Post-TDR Recorded Investment
Single-family:
20- and 30-year or more, amortizing fixed-rate	3,256		$407	3,584		$512	10,533		$1,237	9,671		$1,435
15-year amortizing fixed-rate	96	9		116	10		329	24		435	36
Adjustable-rate	33	3		53	9		95	10		139	21
Alt-A, interest-only, and option ARM	178	24		302	55		687	96		827	154
Total single-family	3,563	443		4,055	586		11,644	1,367		11,072	1,646
Multifamily	—		$—	—		$—	—		$—	—		$—

In addition to modifications, loans may be classified as TDRs as a result of other loss mitigation activities (i.e., repayment plans, forbearance agreements, or trial period modifications). During YTD 2019 and YTD 2018, 3,983 and 6,487, respectively, of such loans (with a post-TDR recorded investment of $0.4 billion and $0.8 billion, respectively) experienced a payment default within a year after the loss mitigation activity occurred.

Non-Cash Investing and Financing Activities

During YTD 2019 and YTD 2018, we acquired $162.7 billion and $122.6 billion, respectively, of loans held-for-investment in exchange for the issuance of debt securities of consolidated trusts in guarantor swap transactions. We received approximately $28.6 billion and $18.8 billion of loans from sellers in guarantor swap transactions and $1.6 billion and $0.1 billion of loans from sellers in cash execution transactions during YTD 2019 and YTD 2018, respectively, to satisfy advances to lenders that were recorded in other assets on our condensed consolidated balance sheets.

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Income Taxes

9 Months Ended

Sep. 30, 2019

Income Tax Disclosure [Abstract]

INCOME TAXES

Income Taxes

Income Tax Expense

For 3Q 2019 and 3Q 2018, we reported income tax expense of $0.4 billion and $0.6 billion, respectively, resulting in effective tax rates of 20.0% and 17.0%, respectively. For YTD 2019 and YTD 2018, we reported income tax expense of $1.2 billion and $1.9 billion, respectively, resulting in effective tax rates of 20.3% and 19.3%, respectively. Our effective tax rates differed from the statutory tax rate of 21% in these periods primarily due to our recognition of low income housing tax credits and tax-exempt interest income.

Deferred Tax Assets, Net

We had net deferred tax assets of $5.8 billion and $6.9 billion as of September 30, 2019 and December 31, 2018, respectively. At September 30, 2019, our net deferred tax assets consisted primarily of basis differences related to derivative instruments and deferred fees.

Based on all positive and negative evidence available at September 30, 2019, we determined that it is more likely than not that our net deferred tax assets, except for a portion of the deferred tax asset related to our capital loss carryforward, will be realized. As of September 30, 2019, we have a $37 million valuation allowance recorded against our capital loss carryforward deferred tax asset.

Unrecognized Tax Benefits

We evaluated all income tax positions and determined that there were no uncertain tax positions that required reserves as of September 30, 2019.

We are under IRS examination for tax years 2013 through 2016 related to the carryback of 2016 capital losses to the prior three years.

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Concentration of Credit and Other Risks - Concentration of Credit Risk - Single-Family Credit Guarantee Portfolio (Details)	9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Concentration Risk [Line Items]
Serious delinquency rate	0.61%		0.69%
West
Concentration Risk [Line Items]
Serious delinquency rate	0.35%		0.38%
Northeast
Concentration Risk [Line Items]
Serious delinquency rate	0.86%		0.96%
North Central
Concentration Risk [Line Items]
Serious delinquency rate	0.60%		0.63%
Southeast
Concentration Risk [Line Items]
Serious delinquency rate	0.72%		0.90%
Southwest
Concentration Risk [Line Items]
Serious delinquency rate	0.51%		0.57%
FLORIDA
Concentration Risk [Line Items]
Serious delinquency rate	0.75%		1.01%
NEW YORK
Concentration Risk [Line Items]
Serious delinquency rate	1.20%		1.37%
NEW JERSEY
Concentration Risk [Line Items]
Serious delinquency rate	1.07%		1.24%
ILLINOIS
Concentration Risk [Line Items]
Serious delinquency rate	0.82%		0.86%
CALIFORNIA
Concentration Risk [Line Items]
Serious delinquency rate	0.33%		0.35%
All Other
Concentration Risk [Line Items]
Serious delinquency rate	0.57%		0.64%
Core single-family loan portfolio
Concentration Risk [Line Items]
Serious delinquency rate	0.24%		0.22%
Legacy and relief refinance single-family loan portfolio
Concentration Risk [Line Items]
Serious delinquency rate	1.77%		1.93%
Single-family UPB
Concentration Risk [Line Items]
Concentration risk percentage	100.00%		100.00%
Single-family UPB | West
Concentration Risk [Line Items]
Concentration risk percentage	30.00%		30.00%
Single-family UPB | Northeast
Concentration Risk [Line Items]
Concentration risk percentage	24.00%		24.00%
Single-family UPB | North Central
Concentration Risk [Line Items]
Concentration risk percentage	16.00%		16.00%
Single-family UPB | Southeast
Concentration Risk [Line Items]
Concentration risk percentage	16.00%		16.00%
Single-family UPB | Southwest
Concentration Risk [Line Items]
Concentration risk percentage	14.00%		14.00%
Single-family UPB | FLORIDA
Concentration Risk [Line Items]
Concentration risk percentage	6.00%		6.00%
Single-family UPB | NEW YORK
Concentration Risk [Line Items]
Concentration risk percentage	5.00%		5.00%
Single-family UPB | NEW JERSEY
Concentration Risk [Line Items]
Concentration risk percentage	3.00%		3.00%
Single-family UPB | ILLINOIS
Concentration Risk [Line Items]
Concentration risk percentage	4.00%		5.00%
Single-family UPB | CALIFORNIA
Concentration Risk [Line Items]
Concentration risk percentage	18.00%		18.00%
Single-family UPB | All Other
Concentration Risk [Line Items]
Concentration risk percentage	64.00%		63.00%
Single-family UPB | Core single-family loan portfolio
Concentration Risk [Line Items]
Concentration risk percentage	84.00%		82.00%
Single-family UPB | Legacy and relief refinance single-family loan portfolio
Concentration Risk [Line Items]
Concentration risk percentage	16.00%		18.00%
Single-family Credit Losses
Concentration Risk [Line Items]
Concentration risk percentage	100.00%	100.00%
Single-family Credit Losses | West
Concentration Risk [Line Items]
Concentration risk percentage	12.00%	17.00%
Single-family Credit Losses | Northeast
Concentration Risk [Line Items]
Concentration risk percentage	40.00%	40.00%
Single-family Credit Losses | North Central
Concentration Risk [Line Items]
Concentration risk percentage	19.00%	18.00%
Single-family Credit Losses | Southeast
Concentration Risk [Line Items]
Concentration risk percentage	22.00%	18.00%
Single-family Credit Losses | Southwest
Concentration Risk [Line Items]
Concentration risk percentage	7.00%	7.00%
Single-family Credit Losses | FLORIDA
Concentration Risk [Line Items]
Concentration risk percentage	14.00%	10.00%
Single-family Credit Losses | NEW YORK
Concentration Risk [Line Items]
Concentration risk percentage	12.00%	12.00%
Single-family Credit Losses | NEW JERSEY
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	10.00%
Single-family Credit Losses | ILLINOIS
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	9.00%
Single-family Credit Losses | CALIFORNIA
Concentration Risk [Line Items]
Concentration risk percentage	7.00%	10.00%
Single-family Credit Losses | All Other
Concentration Risk [Line Items]
Concentration risk percentage	47.00%	49.00%
Single-family Credit Losses | Core single-family loan portfolio
Concentration Risk [Line Items]
Concentration risk percentage	16.00%	12.00%
Single-family Credit Losses | Legacy and relief refinance single-family loan portfolio
Concentration Risk [Line Items]
Concentration risk percentage	84.00%	88.00%

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Consolidated Balance Sheets (Parenthetical) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Restricted Cash and Cash Equivalents	$ 3,560,000,000	$ 596,000,000
Mortgages Held-for-sale, Fair Value Disclosure	21,538,000,000	23,106,000,000
Allowance for loan losses	4,854,000,000	6,139,000,000
Other Assets, Fair Value Disclosure	4,590,000,000	3,929,000,000
Debt instrument recorded at fair value	4,600,000,000	5,112,000,000
Senior preferred stock, at redemption value	$ 77,474,000,000	$ 75,648,000,000
Common Stock, No Par Value	$ 0	$ 0
Common Stock, Shares Authorized	4,000,000,000	4,000,000,000
Common Stock, Shares, Issued	725,863,886	725,863,886
Common Stock, Shares, Outstanding	650,059,033	650,058,775
Available for sale securities other-than-temporary impairment adjustment, related to net unrealized gains(losses) on securities for which other-than-temporary impairment has been recognized in earnings	$ 243,000,000	$ 221,000,000
Treasury Stock, Shares	75,804,853	75,805,111

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Collateral and Offsetting of Assets and Liabilities - Underlying Collateral Pledged (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	$ 12,917	$ 8,802
Securities Sold under Agreements to Repurchase
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	8,713	$ 6,027
Securities Sold under Agreements to Repurchase | Overnight and continuous
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	2,684
Securities Sold under Agreements to Repurchase | 30 days or less
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	5,112
Securities Sold under Agreements to Repurchase | After 30 days through 90 days
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	917
Securities Sold under Agreements to Repurchase | Greater than 90 days
Collateral in the Form of Securities Pledged [Line Items]
Securities pledged with the ability for the secured party to repledge	$ 0

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Stockholders' Equity and Earnings per Share - Changes in AOCI by Component, Net of Tax (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	$ 4,826	$ 4,585	$ 4,477	$ (312)
Total other comprehensive income (loss), net of taxes and reclassification adjustments	139	(147)	717	(991)
Cumulative effect of change in accounting principle				0
Ending balance	6,674	5,559	6,674	5,559
Total
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	443	(366)	(135)	389
Other comprehensive income (loss) before reclassifications			774	(822)
Amounts reclassified from accumulated other comprehensive income			(57)	(169)
Total other comprehensive income (loss), net of taxes and reclassification adjustments	139	(147)	717	(991)
Cumulative effect of change in accounting principle				89
Ending balance	582	(513)	582	(513)
AOCI related to available-for-sale securities
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			83	662
Other comprehensive income (loss) before reclassifications			776	(821)
Amounts reclassified from accumulated other comprehensive income			(102)	(244)
Total other comprehensive income (loss), net of taxes and reclassification adjustments			674	(1,065)
Cumulative effect of change in accounting principle				143
Ending balance	757	(260)	757	(260)
AOCI related to cash flow hedge relationships
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			(315)	(356)
Other comprehensive income (loss) before reclassifications			0	0
Amounts reclassified from accumulated other comprehensive income			57	87
Total other comprehensive income (loss), net of taxes and reclassification adjustments			57	87
Cumulative effect of change in accounting principle				(73)
Ending balance	(258)	(342)	(258)	(342)
AOCI related to defined benefit plans
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			97	83
Other comprehensive income (loss) before reclassifications			(2)	(1)
Amounts reclassified from accumulated other comprehensive income			(12)	(12)
Total other comprehensive income (loss), net of taxes and reclassification adjustments			(14)	(13)
Cumulative effect of change in accounting principle				19
Ending balance	$ 83	$ 89	$ 83	$ 89

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Derivatives - Derivative Assets and Liabilities at Fair Value (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Derivative [Line Items]
Notional or contractual amount	$ 1,161,284.0	$ 876,042.0
Derivative interest receivable and other	912.0	889.0
Netting adjustments to derivative assets	(7,228.0)	(6,972.0)
Derivative Assets, net	1,592.0	335.0
Derivative interest payable and other	(872.0)	(1,096.0)
Netting adjustments to derivative liabilities	6,994.0	4,941.0
Derivative liabilities, net	(355.0)	(583.0)
Commitments
Derivative [Line Items]
Derivative assets at fair value	195.0	90.0
Other
Derivative [Line Items]
Derivative Assets, net	208.0	91.0
Derivative liabilities, net	(297.0)	(317.0)
Not Designated as Hedging Instrument, Economic Hedge
Derivative [Line Items]
Notional or contractual amount	968,893.0	681,491.0
Derivative assets at fair value	7,756.0	6,148.0
Derivative liabilities at fair value	(4,766.0)	(2,922.0)
Not Designated as Hedging Instrument, Economic Hedge | CDX swaption
Derivative [Line Items]
Notional or contractual amount	17,300.0	45,900.0
Derivative assets at fair value	6.0	113.0
Not Designated as Hedging Instrument, Economic Hedge | Interest Rate Swaps
Derivative [Line Items]
Notional or contractual amount	469,858.0	321,689.0
Derivative assets at fair value	2,352.0	1,857.0
Derivative liabilities at fair value	(4,391.0)	(2,468.0)
Not Designated as Hedging Instrument, Economic Hedge | Receive-fixed
Derivative [Line Items]
Notional or contractual amount	217,377.0	145,386.0
Derivative assets at fair value	2,346.0	1,380.0
Derivative liabilities at fair value	(10.0)	(181.0)
Not Designated as Hedging Instrument, Economic Hedge | Pay-fixed
Derivative [Line Items]
Notional or contractual amount	246,557.0	170,899.0
Derivative assets at fair value	6.0	476.0
Derivative liabilities at fair value	(4,381.0)	(2,287.0)
Not Designated as Hedging Instrument, Economic Hedge | Basis (floating to floating)
Derivative [Line Items]
Notional or contractual amount	5,924.0	5,404.0
Derivative assets at fair value	0.0	1.0
Derivative liabilities at fair value	0.0	0.0
Not Designated as Hedging Instrument, Economic Hedge | Option-based
Derivative [Line Items]
Notional or contractual amount	146,443.0	148,331.0
Derivative assets at fair value	5,196.0	4,200.0
Derivative liabilities at fair value	(78.0)	(137.0)
Not Designated as Hedging Instrument, Economic Hedge | Call swaptions | Purchased
Derivative [Line Items]
Notional or contractual amount	61,275.0	43,625.0
Derivative assets at fair value	3,963.0	2,007.0
Derivative liabilities at fair value	0.0	0.0
Not Designated as Hedging Instrument, Economic Hedge | Call swaptions | Written
Derivative [Line Items]
Notional or contractual amount	2,500.0	4,400.0
Derivative assets at fair value	0.0	0.0
Derivative liabilities at fair value	(37.0)	(133.0)
Not Designated as Hedging Instrument, Economic Hedge | Put swaptions | Purchased
Derivative [Line Items]
Notional or contractual amount	63,600.0	88,075.0
Derivative assets at fair value	512.0	1,565.0
Derivative liabilities at fair value	0.0	0.0
Not Designated as Hedging Instrument, Economic Hedge | Put swaptions | Written
Derivative [Line Items]
Notional or contractual amount	8,700.0	1,750.0
Derivative assets at fair value	0.0	0.0
Derivative liabilities at fair value	(41.0)	(4.0)
Not Designated as Hedging Instrument, Economic Hedge | Other option-based derivatives
Derivative [Line Items]
Notional or contractual amount	10,368.0	10,481.0
Derivative assets at fair value	721.0	628.0
Derivative liabilities at fair value	0.0	0.0
Not Designated as Hedging Instrument, Economic Hedge | Futures
Derivative [Line Items]
Notional or contractual amount	181,479.0	161,185.0
Derivative assets at fair value	0.0	0.0
Derivative liabilities at fair value	0.0	0.0
Not Designated as Hedging Instrument, Economic Hedge | Commitments
Derivative [Line Items]
Notional or contractual amount	152,300.0	36,044.0
Derivative assets at fair value	195.0	90.0
Derivative liabilities at fair value	(171.0)	(179.0)
Not Designated as Hedging Instrument, Economic Hedge | Credit derivatives
Derivative [Line Items]
Notional or contractual amount	1,822.0	2,030.0
Derivative assets at fair value	1.0	0.0
Derivative liabilities at fair value	(23.0)	(35.0)
Not Designated as Hedging Instrument, Economic Hedge | Other
Derivative [Line Items]
Notional or contractual amount	16,991.0	12,212.0
Derivative assets at fair value	12.0	1.0
Derivative liabilities at fair value	(103.0)	(103.0)
Designated as Hedging Instrument [Member] | Fair Value Hedging
Derivative [Line Items]
Notional or contractual amount	192,391.0	194,551.0
Derivative assets at fair value	152.0	270.0
Derivative liabilities at fair value	(1,711.0)	(1,506.0)
Designated as Hedging Instrument [Member] | Fair Value Hedging | Receive-fixed
Derivative [Line Items]
Notional or contractual amount	113,425.0	117,038.0
Derivative assets at fair value	145.0	23.0
Derivative liabilities at fair value	(91.0)	(935.0)
Designated as Hedging Instrument [Member] | Fair Value Hedging | Pay-fixed
Derivative [Line Items]
Notional or contractual amount	78,966.0	77,513.0
Derivative assets at fair value	7.0	247.0
Derivative liabilities at fair value	$ (1,620.0)	$ (571.0)

XML

Collateral and Offsetting of Assets and Liabilities (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Offsetting Assets [Line Items]
Maximum loss after applying netting agreements and collateral	$ 401	$ 162
Commitments
Offsetting Assets [Line Items]
Total exposure on our commitments	195	90
OTC derivatives
Offsetting Assets [Line Items]
Maximum loss after applying netting agreements and collateral	44	48
Cash pledged to us as collateral that was invested as part of our liquidity and contingency operating portfolio	3,100
Federal Funds Sold and Securities Borrowed or Purchased under Agreements to Resell [Member]
Offsetting Assets [Line Items]
Securities Held as Collateral, at Fair Value	27,600	20,100
Securities purchased under agreements to resell not executed with clearinghouse [Member]
Offsetting Assets [Line Items]
Securities Held as Collateral, at Fair Value	$ 2,200	$ 2,500

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Conservatorship and Related Matters

9 Months Ended

Sep. 30, 2019

Conservatorship and Related Matters [Abstract]

CONSERVATORSHIP AND RELATED MATTERS

Conservatorship and Related Matters

Business Objectives

We operate under the conservatorship that commenced on September 6, 2008, conducting our business under the direction of FHFA, as our Conservator. The conservatorship and related matters significantly affect our management, business activities, financial condition, and results of operations. Upon its appointment, FHFA, as Conservator, immediately succeeded to all rights, titles, powers, and privileges of Freddie Mac, and of any stockholder, officer, or director thereof, with respect to the company and its assets. The Conservator also succeeded to the title to all books, records, and assets of Freddie Mac held by any other legal custodian or third party. The Conservator provided for the Board of Directors to perform certain functions and to oversee management, and the Board delegated to management authority to conduct business operations so that the company can continue to operate in the ordinary course. The directors serve on behalf of, and perform such functions as provided by, the Conservator.

We are subject to certain constraints on our business activities under the Purchase Agreement. However, the support provided by Treasury pursuant to the Purchase Agreement currently enables us to maintain our access to the debt markets and to have adequate liquidity to conduct our normal business activities, although the costs of our debt funding could vary. Our ability to access funds from Treasury under the Purchase Agreement is critical to keeping us solvent.

Purchase Agreement

Treasury, as the holder of the senior preferred stock, is entitled to receive quarterly cash dividends, when, as, and if declared by our Board of Directors. The dividends we have paid to Treasury on the senior preferred stock have been declared by, and paid at the direction of, the Conservator, acting as successor to the rights, titles, powers, and privileges of the Board.

Under the August 2012 amendment to the Purchase Agreement, for each quarter from January 1, 2013 and thereafter, the dividend payment will be the amount, if any, by which our Net Worth Amount at the end of the immediately preceding fiscal quarter, less the applicable Capital Reserve Amount, exceeds zero. Pursuant to the September 2019 Letter Agreement, the applicable Capital Reserve Amount is $20.0 billion. If for any reason we do not pay the net worth sweep dividend in full for any period, the applicable Capital Reserve Amount will thereafter be zero.

In addition, pursuant to the September 2019 Letter Agreement, the liquidation preference of the senior preferred stock will be increased, at the end of each fiscal quarter, beginning on September 30, 2019, by an amount equal to the increase in the Net Worth Amount, if any, during the immediately prior fiscal quarter, until the liquidation preference has increased by $17.0 billion. As a result, the liquidation preference of the senior preferred stock increased from $75.6 billion to $77.5 billion on September 30, 2019 based on the $1.8 billion increase in our Net Worth Amount during 2Q 2019, and will increase to $79.3 billion on December 31, 2019 based on the $1.8 billion increase in our Net Worth Amount during 3Q 2019.

Under the September 2019 Letter Agreement, Freddie Mac and Treasury also agreed to negotiate and execute an amendment to the Purchase Agreement that further enhances taxpayer protections by adopting covenants broadly consistent with recommendations for administrative reform contained in the Treasury's September 2019 Housing Reform Plan.

Impact of Conservatorship and Related Developments on the Mortgage-Related Investments Portfolio

In February 2019, FHFA directed us to maintain the UPB of our mortgage-related investments portfolio at or below $225 billion at all times. The UPB of this portfolio was $221.6 billion at September 30, 2019. Our ability to acquire and sell mortgage assets continues to be significantly constrained by limitations imposed by the Purchase Agreement and FHFA.

Government Support for Our Business

We receive substantial support from Treasury and are dependent upon its continued support to continue operating our business. Our ability to access funds from Treasury under the Purchase Agreement is critical to:

n Keeping us solvent;

n Allowing us to focus on our primary business objectives under conservatorship; and

n Avoiding the appointment of a receiver by FHFA under statutory mandatory receivership provisions.

At June 30, 2019, our assets exceeded our liabilities under GAAP; therefore, FHFA, as Conservator, did not request a draw on our behalf and, as a result, we did not receive any funding from Treasury under the Purchase Agreement during 3Q 2019. The amount of available funding remaining under the Purchase Agreement is $140.2 billion and will be reduced by any future draws.

See Note 8 and Note 11 for more information on the conservatorship and the Purchase Agreement.

Related Parties As a Result of Conservatorship

We are deemed related parties with Fannie Mae as both we and Fannie Mae have the same relationships with FHFA and Treasury. CSS was formed in 2013 as a limited liability company equally-owned by Freddie Mac and Fannie Mae and is also deemed a related party. In connection with the formation of CSS, we entered into a limited liability company agreement with Fannie Mae. We and Fannie Mae have each appointed two executives to the CSS Board of Managers and signed governance and operating agreements for CSS, including an updated customer services agreement with Fannie Mae and CSS in May of 2019. In June of 2019, we entered into an agreement with Fannie Mae regarding the commingling of certain of our mortgage securities under the Single Security Initiative and related indemnification obligations. During YTD 2019, we contributed $84 million of capital to CSS, and we have contributed $548 million since the fourth quarter of 2014.

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Segment Reporting (Details)	9 Months Ended
	Sep. 30, 2019
Segment Reporting Information [Line Items]
Number of reportable segments	3

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Guarantee Activities - Financial Guarantees (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018	Jun. 30, 2019	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Guarantor Obligations [Line Items]
Recognized Liability	$ 4,055	$ 3,561
Reserve for guarantee losses	4,905			$ 7,002
Payment Guarantee
Guarantor Obligations [Line Items]
Maximum Exposure	24,976	16,251
Recognized Liability	$ 183	$ 242
Maximum Remaining Term	30 years	30 years
Single-family
Guarantor Obligations [Line Items]
Maximum Exposure	$ 31,526	$ 23,922
Recognized Liability	497	387
Reserve for guarantee losses	4,887	6,176	$ 5,326	6,984	$ 8,433	$ 8,979
Single-family | Securitization activity guarantees
Guarantor Obligations [Line Items]
Maximum Exposure	24,387	17,783
Recognized Liability	$ 317	$ 220
Maximum Remaining Term	40 years	40 years
Single-family | Other mortgage-related guarantees
Guarantor Obligations [Line Items]
Maximum Exposure	$ 7,139	$ 6,139
Recognized Liability	$ 180	$ 167
Maximum Remaining Term	30 years	30 years
Multifamily
Guarantor Obligations [Line Items]
Maximum Exposure	$ 251,975	$ 231,024
Recognized Liability	3,558	3,174
Reserve for guarantee losses	18			18
Multifamily | Securitization activity guarantees
Guarantor Obligations [Line Items]
Maximum Exposure	241,853	221,245
Recognized Liability	$ 3,128	$ 2,746
Maximum Remaining Term	40 years	40 years
Multifamily | Other mortgage-related guarantees
Guarantor Obligations [Line Items]
Maximum Exposure	$ 10,122	$ 9,779
Recognized Liability	$ 430	$ 428
Maximum Remaining Term	35 years	35 years
Reserve for guarantee losses
Guarantor Obligations [Line Items]
Reserve for guarantee losses	$ 51	$ 52		56
Reserve for guarantee losses | Single-family
Guarantor Obligations [Line Items]
Reserve for guarantee losses	46	$ 46	$ 46	48	$ 49	$ 48
Reserve for guarantee losses | Multifamily
Guarantor Obligations [Line Items]
Reserve for guarantee losses	$ 5			$ 8

XML

Mortgage Loans and Loan Loss Reserves - Individually Impaired Loans (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
With specific allowance recorded [Abstract]
Impaired Financing Receivable, Related Allowance	$ (3,326)		$ (3,326)		$ (4,369)
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	41,479		41,479		48,276
Impaired Financing Receivable, Recorded Investment	40,205		40,205		46,506
Average Recorded Investment	40,875	$ 53,612	42,769	$ 58,666
Interest Income Recognized	554	710	1,868	2,204
Interest Income Recognized On Cash Basis	59	66	168	269
Single-family 20 and 30-year or more, amortizing fixed-rate
With no specific allowance recorded [Abstract]
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	3,008		3,008		3,335
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	2,390		2,390		2,666
Average Recorded Investment	2,450	3,142	2,573	3,399
Interest Income Recognized	59	83	207	268
Interest Income Recognized On Cash Basis	1	3	6	13
With specific allowance recorded [Abstract]
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	32,441		32,441		37,579
Impaired Financing Receivable, with Related Allowance, Recorded Investment	32,118		32,118		36,959
Impaired Financing Receivable, Related Allowance	(2,784)		(2,784)		(3,660)
Average Recorded Investment	32,618	42,393	34,051	46,140
Interest Income Recognized	412	520	1,394	1,621
Interest Income Recognized On Cash Basis	47	52	138	217
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	35,449		35,449		40,914
Impaired Financing Receivable, Recorded Investment	34,508		34,508		39,625
Average Recorded Investment	35,068	45,535	36,624	49,539
Interest Income Recognized	471	603	1,601	1,889
Interest Income Recognized On Cash Basis	48	55	144	230
Single-family 15-year amortizing fixed-rate
With no specific allowance recorded [Abstract]
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	20		20		23
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	20		20		22
Average Recorded Investment	19	20	20	21
Interest Income Recognized	1	0	1	3
Interest Income Recognized On Cash Basis	0	0	0	0
With specific allowance recorded [Abstract]
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	641		641		703
Impaired Financing Receivable, with Related Allowance, Recorded Investment	650		650		713
Impaired Financing Receivable, Related Allowance	(14)		(14)		(19)
Average Recorded Investment	641	740	665	830
Interest Income Recognized	5	7	17	21
Interest Income Recognized On Cash Basis	1	2	3	8
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	661		661		726
Impaired Financing Receivable, Recorded Investment	670		670		735
Average Recorded Investment	660	760	685	851
Interest Income Recognized	6	7	18	24
Interest Income Recognized On Cash Basis	1	2	3	8
Single-family Adjustable-rate
With no specific allowance recorded [Abstract]
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	183		183		227
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	182		182		226
Average Recorded Investment	191	238	209	255
Interest Income Recognized	3	3	9	9
Interest Income Recognized On Cash Basis	0	0	0	0
With specific allowance recorded [Abstract]
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	133		133		164
Impaired Financing Receivable, with Related Allowance, Recorded Investment	132		132		162
Impaired Financing Receivable, Related Allowance	(7)		(7)		(8)
Average Recorded Investment	129	183	139	210
Interest Income Recognized	2	2	5	4
Interest Income Recognized On Cash Basis	0	0	1	2
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	316		316		391
Impaired Financing Receivable, Recorded Investment	314		314		388
Average Recorded Investment	320	421	348	465
Interest Income Recognized	5	5	14	13
Interest Income Recognized On Cash Basis	0	0	1	2
Single-family Alt-A, interest-only, and option ARM
With no specific allowance recorded [Abstract]
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	1,004		1,004		1,286
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	853		853		1,083
Average Recorded Investment	880	1,159	932	1,319
Interest Income Recognized	16	21	52	68
Interest Income Recognized On Cash Basis	0	1	1	3
With specific allowance recorded [Abstract]
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	3,962		3,962		4,867
Impaired Financing Receivable, with Related Allowance, Recorded Investment	3,779		3,779		4,590
Impaired Financing Receivable, Related Allowance	(521)		(521)		(682)
Average Recorded Investment	3,866	5,622	4,097	6,357
Interest Income Recognized	55	72	180	205
Interest Income Recognized On Cash Basis	9	7	18	24
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	4,966		4,966		6,153
Impaired Financing Receivable, Recorded Investment	4,632		4,632		5,673
Average Recorded Investment	4,746	6,781	5,029	7,676
Interest Income Recognized	71	93	232	273
Interest Income Recognized On Cash Basis	9	8	19	27
Single-family
With no specific allowance recorded [Abstract]
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	4,215		4,215		4,871
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	3,445		3,445		3,997
Average Recorded Investment	3,540	4,559	3,734	4,994
Interest Income Recognized	79	107	269	348
Interest Income Recognized On Cash Basis	1	4	7	16
With specific allowance recorded [Abstract]
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	37,177		37,177		43,313
Impaired Financing Receivable, with Related Allowance, Recorded Investment	36,679		36,679		42,424
Impaired Financing Receivable, Related Allowance	(3,326)		(3,326)		(4,369)
Average Recorded Investment	37,254	48,938	38,952	53,537
Interest Income Recognized	474	601	1,596	1,851
Interest Income Recognized On Cash Basis	57	61	160	251
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	41,392		41,392		48,184
Impaired Financing Receivable, Recorded Investment	40,124		40,124		46,421
Average Recorded Investment	40,794	53,497	42,686	58,531
Interest Income Recognized	553	708	1,865	2,199
Interest Income Recognized On Cash Basis	58	65	167	267
Multifamily
With no specific allowance recorded [Abstract]
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance	87		87		89
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	81		81		82
Average Recorded Investment	81	112	83	132
Interest Income Recognized	1	2	3	5
Interest Income Recognized On Cash Basis	1	1	1	2
With specific allowance recorded [Abstract]
Impaired Financing Receivable, with Related Allowance, Unpaid Principal Balance	0		0		3
Impaired Financing Receivable, with Related Allowance, Recorded Investment	0		0		3
Impaired Financing Receivable, Related Allowance	0		0		0
Average Recorded Investment	0	3	0	3
Interest Income Recognized	0	0	0	0
Interest Income Recognized On Cash Basis	0	0	0	0
Individually Impaired Mortgage Loans [Abstract]
Impaired Financing Receivable, Unpaid Principal Balance	87		87		92
Impaired Financing Receivable, Recorded Investment	81		81		$ 85
Average Recorded Investment	81	115	83	135
Interest Income Recognized	1	2	3	5
Interest Income Recognized On Cash Basis	$ 1	$ 1	$ 1	$ 2

XML

Fair Value Disclosures - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	$ 28,533	$ 33,563
Mortgage Loans [Abstract]
Mortgage loans, held for sale, at fair value	21,538	23,106
Derivative Assets Net [Abstract]
Derivative Assets, net	1,592	335
Other Assets [Abstract]
Total Other Assets	4,590	3,929
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	4,600	5,112
Derivative Liabilities Net [Abstract]
Derivative Liabilities	355	583
Held by consolidated trusts
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	737	755
Held by Freddie Mac
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	3,900	4,400
Other
Derivative Assets Net [Abstract]
Derivative Assets, net	208	91
Derivative Liabilities Net [Abstract]
Derivative Liabilities	297	317
Freddie Mac
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	26,119	30,199
Other agency
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	1,026	1,706
Non-agency and other
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	1,388	1,658
Fair Value, Measurements, Recurring
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	28,533	33,563
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	44,449	35,548
Total investments in securities	72,982	69,111
Mortgage Loans [Abstract]
Mortgage loans, held for sale, at fair value	21,538	23,106
Derivative Assets Net [Abstract]
Derivative assets at fair value	7,908	6,418
Netting Adjustment	(6,316)	(6,083)
Derivative Assets, net	1,592	335
Other Assets [Abstract]
Guarantee Assets	4,225	3,633
Non-derivative held-for-sale purchase commitments, at fair value	223	159
All Other Assets Fair Value Disclosure	142	137
Total Other Assets	4,590	3,929
Total Assets at Fair value	100,702	96,481
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	6,477	4,428
Netting Adjustment	(6,122)	(3,845)
Derivative Liabilities	355	583
Non Derivative HFS Purchase Commitment Liabilities	1	17
All Other Liabilities Fair Value Disclosure	2
Total liabilities carried at fair value on a recurring basis	4,958	5,712
Fair Value, Measurements, Recurring | Held by consolidated trusts
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	737	755
Fair Value, Measurements, Recurring | Held by Freddie Mac
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	3,863	4,357
Fair Value, Measurements, Recurring | Interest-rate swaps
Derivative Assets Net [Abstract]
Derivative assets at fair value	2,504	2,127
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	6,102	3,974
Fair Value, Measurements, Recurring | Option-based derivatives
Derivative Assets Net [Abstract]
Derivative assets at fair value	5,196	4,200
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	78	137
Fair Value, Measurements, Recurring | Other
Derivative Assets Net [Abstract]
Derivative assets at fair value	208	91
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	297	317
Fair Value, Measurements, Recurring | Mortage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	20,167	16,373
Fair Value, Measurements, Recurring | Freddie Mac
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	26,119	30,199
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	12,972	13,821
Fair Value, Measurements, Recurring | Other agency
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	1,026	1,706
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	7,194	2,551
Fair Value, Measurements, Recurring | Non-agency and other
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	1,388	1,658
Fair Value, Measurements, Recurring | All other
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	1	1
Fair Value, Measurements, Recurring | Non-mortgage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	24,282	19,175
Fair Value, Measurements, Recurring | Level 1
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	0	0
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	21,952	15,885
Total investments in securities	21,952	15,885
Mortgage Loans [Abstract]
Mortgage loans, held for sale, at fair value	0	0
Derivative Assets Net [Abstract]
Derivative assets at fair value	0	0
Derivative Assets, net	0	0
Other Assets [Abstract]
Guarantee Assets	0	0
Non-derivative held-for-sale purchase commitments, at fair value	0	0
All Other Assets Fair Value Disclosure	0	0
Total Other Assets	0	0
Total Assets at Fair value	21,952	15,885
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	0	0
Derivative Liabilities	0	0
Non Derivative HFS Purchase Commitment Liabilities	0	0
All Other Liabilities Fair Value Disclosure	0
Total liabilities carried at fair value on a recurring basis	0	0
Fair Value, Measurements, Recurring | Level 1 | Held by consolidated trusts
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	0	0
Fair Value, Measurements, Recurring | Level 1 | Held by Freddie Mac
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	0	0
Fair Value, Measurements, Recurring | Level 1 | Interest-rate swaps
Derivative Assets Net [Abstract]
Derivative assets at fair value	0	0
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	0	0
Fair Value, Measurements, Recurring | Level 1 | Option-based derivatives
Derivative Assets Net [Abstract]
Derivative assets at fair value	0	0
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	0	0
Fair Value, Measurements, Recurring | Level 1 | Other
Derivative Assets Net [Abstract]
Derivative assets at fair value	0	0
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	0	0
Fair Value, Measurements, Recurring | Level 1 | Mortage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	0	0
Fair Value, Measurements, Recurring | Level 1 | Freddie Mac
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	0	0
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	0	0
Fair Value, Measurements, Recurring | Level 1 | Other agency
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	0	0
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	0	0
Fair Value, Measurements, Recurring | Level 1 | Non-agency and other
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	0	0
Fair Value, Measurements, Recurring | Level 1 | All other
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	0	0
Fair Value, Measurements, Recurring | Level 1 | Non-mortgage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	21,952	15,885
Fair Value, Measurements, Recurring | Level 2
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	24,982	27,788
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	19,561	16,369
Total investments in securities	44,543	44,157
Mortgage Loans [Abstract]
Mortgage loans, held for sale, at fair value	21,538	23,106
Derivative Assets Net [Abstract]
Derivative assets at fair value	7,892	6,417
Derivative Assets, net	7,892	6,417
Other Assets [Abstract]
Guarantee Assets	0	0
Non-derivative held-for-sale purchase commitments, at fair value	223	159
All Other Assets Fair Value Disclosure	0	0
Total Other Assets	223	159
Total Assets at Fair value	74,196	73,839
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	6,437	4,336
Derivative Liabilities	6,437	4,336
Non Derivative HFS Purchase Commitment Liabilities	1	17
All Other Liabilities Fair Value Disclosure	0
Total liabilities carried at fair value on a recurring basis	10,175	8,603
Fair Value, Measurements, Recurring | Level 2 | Held by consolidated trusts
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	4	27
Fair Value, Measurements, Recurring | Level 2 | Held by Freddie Mac
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	3,733	4,223
Fair Value, Measurements, Recurring | Level 2 | Interest-rate swaps
Derivative Assets Net [Abstract]
Derivative assets at fair value	2,504	2,127
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	6,102	3,974
Fair Value, Measurements, Recurring | Level 2 | Option-based derivatives
Derivative Assets Net [Abstract]
Derivative assets at fair value	5,196	4,200
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	78	137
Fair Value, Measurements, Recurring | Level 2 | Other
Derivative Assets Net [Abstract]
Derivative assets at fair value	192	90
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	257	225
Fair Value, Measurements, Recurring | Level 2 | Mortage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	17,231	13,079
Fair Value, Measurements, Recurring | Level 2 | Freddie Mac
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	23,969	26,102
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	10,042	10,535
Fair Value, Measurements, Recurring | Level 2 | Other agency
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	992	1,668
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	7,189	2,544
Fair Value, Measurements, Recurring | Level 2 | Non-agency and other
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	21	18
Fair Value, Measurements, Recurring | Level 2 | All other
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	0	0
Fair Value, Measurements, Recurring | Level 2 | Non-mortgage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,330	3,290
Fair Value, Measurements, Recurring | Level 3
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	3,551	5,775
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,936	3,294
Total investments in securities	6,487	9,069
Mortgage Loans [Abstract]
Mortgage loans, held for sale, at fair value	0	0
Derivative Assets Net [Abstract]
Derivative assets at fair value	16	1
Derivative Assets, net	16	1
Other Assets [Abstract]
Guarantee Assets	4,225	3,633
Non-derivative held-for-sale purchase commitments, at fair value	0	0
All Other Assets Fair Value Disclosure	142	137
Total Other Assets	4,367	3,770
Total Assets at Fair value	10,870	12,840
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	40	92
Derivative Liabilities	40	92
Non Derivative HFS Purchase Commitment Liabilities	0	0
All Other Liabilities Fair Value Disclosure	2
Total liabilities carried at fair value on a recurring basis	905	954
Fair Value, Measurements, Recurring | Level 3 | Held by consolidated trusts
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	733	728
Fair Value, Measurements, Recurring | Level 3 | Held by Freddie Mac
Liabilities, Fair Value Disclosure [Abstract]
Debt instrument recorded at fair value	130	134
Fair Value, Measurements, Recurring | Level 3 | Interest-rate swaps
Derivative Assets Net [Abstract]
Derivative assets at fair value	0	0
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	0	0
Fair Value, Measurements, Recurring | Level 3 | Option-based derivatives
Derivative Assets Net [Abstract]
Derivative assets at fair value	0	0
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	0	0
Fair Value, Measurements, Recurring | Level 3 | Other
Derivative Assets Net [Abstract]
Derivative assets at fair value	16	1
Derivative Liabilities Net [Abstract]
Derivative liabilities at fair value	40	92
Fair Value, Measurements, Recurring | Level 3 | Mortage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,936	3,294
Fair Value, Measurements, Recurring | Level 3 | Freddie Mac
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	2,150	4,097
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	2,930	3,286
Fair Value, Measurements, Recurring | Level 3 | Other agency
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	34	38
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	5	7
Fair Value, Measurements, Recurring | Level 3 | Non-agency and other
Available-For-Sale, at Fair Value:
Available-for-sale, at fair value	1,367	1,640
Fair Value, Measurements, Recurring | Level 3 | All other
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	1	1
Fair Value, Measurements, Recurring | Level 3 | Non-mortgage-related securities
Trading, at Fair Value:
Trading Securities, Fair Value Disclosure	$ 0	$ 0

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Investments in Securities - Available-For-Sale Securities in a Gross Unrealized Loss Position (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months Fair Value	$ 5,368	$ 4,653
Less than 12 Months Gross Unrealized Losses	(41)	(40)
12 Months or Greater Fair Value	3,482	15,395
12 Months or Greater Gross Unrealized Losses	(44)	(497)
Freddie Mac
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months Fair Value	5,312	4,259
Less than 12 Months Gross Unrealized Losses	(41)	(38)
12 Months or Greater Fair Value	2,951	14,751
12 Months or Greater Gross Unrealized Losses	(39)	(490)
Other agency
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months Fair Value	56	351
Less than 12 Months Gross Unrealized Losses	0	(1)
12 Months or Greater Fair Value	531	638
12 Months or Greater Gross Unrealized Losses	(5)	(6)
Non-agency and other
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months Fair Value	0	43
Less than 12 Months Gross Unrealized Losses	0	(1)
12 Months or Greater Fair Value	0	6
12 Months or Greater Gross Unrealized Losses	$ 0	$ (1)

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Investments in Securities (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($) numberofsecurities	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) numberofsecurities	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)
Debt Securities, Available-for-sale [Line Items]
Debt Securities, Held-to-maturity	$ 0		$ 0		$ 0
Net unrealized gains (losses) on trading securities held at balance sheets date	27	$ (305)	310	$ (951)
Debt Securities, Available-for-sale, Maturity, Allocated and Single Maturity Date, Rolling after 10 Years, Fair Value	24,000		24,000
Debt Securities, Available-for-sale, Maturity, Allocated and Single Maturity Date, Rolling after Five Through Ten Years, Fair Value	$ 4,100		$ 4,100
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | numberofsecurities	150		150

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Concentration of Credit and Other Risks - Certain Higher-Risk Categories in the Single-Family Credit Guarantee Portfolio (Details)	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Concentration Risk [Line Items]
Serious delinquency rate	0.61%	0.69%
Interest-only
Concentration Risk [Line Items]
Serious delinquency rate	2.72%	3.43%
Alt-A
Concentration Risk [Line Items]
Serious delinquency rate	3.75%	4.13%
Original LTV ratio greater than 90%
Concentration Risk [Line Items]
Serious delinquency rate	0.92%	1.04%
Lower credit scores at origination (less than 620)
Concentration Risk [Line Items]
Serious delinquency rate	4.24%	4.59%
Single-family UPB
Concentration Risk [Line Items]
Percentage of Portfolio	100.00%	100.00%
Single-family UPB | Interest-only
Concentration Risk [Line Items]
Percentage of Portfolio	1.00%	1.00%
Single-family UPB | Alt-A
Concentration Risk [Line Items]
Percentage of Portfolio	1.00%	1.00%
Single-family UPB | Original LTV ratio greater than 90%
Concentration Risk [Line Items]
Percentage of Portfolio	18.00%	18.00%
Single-family UPB | Lower credit scores at origination (less than 620)
Concentration Risk [Line Items]
Percentage of Portfolio	2.00%	2.00%

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Debt Securities and Subordinated Borrowings - Debt Securities of Consolidated Trusts Held by Third Parties (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Debt, Net	$ 2,149,259	$ 2,044,950
Debt instrument recorded at fair value	4,600	5,112
Held by consolidated trusts
Debt Instrument [Line Items]
UPB	1,824,706	1,748,738
Debt, Net	$ 1,869,308	$ 1,792,677
Effective rate for debt securities of consolidated trusts held by third parties	2.81%	3.07%
Debt instrument recorded at fair value	$ 737	$ 755
Held by consolidated trusts | Single-family
Debt Instrument [Line Items]
UPB	1,818,473	1,744,373
Debt, Net	1,863,015	1,788,276
Held by consolidated trusts | Multifamily
Debt Instrument [Line Items]
UPB	6,233	4,365
Debt, Net	$ 6,293	$ 4,401
Weighted Average Coupon	3.14%	4.02%
Held by consolidated trusts | Single-family 30-year or more, fixed-rate | Single-family
Debt Instrument [Line Items]
UPB	$ 1,487,105	$ 1,389,113
Debt, Net	$ 1,525,505	$ 1,426,060
Weighted Average Coupon	3.69%	3.72%
Held by consolidated trusts | Single-family 20-year fixed-rate | Single-family
Debt Instrument [Line Items]
UPB	$ 69,068	$ 70,547
Debt, Net	$ 70,764	$ 72,354
Weighted Average Coupon	3.42%	3.43%
Held by consolidated trusts | Single-family 15-year fixed-rate | Single-family
Debt Instrument [Line Items]
UPB	$ 224,190	$ 240,310
Debt, Net	$ 227,915	$ 244,587
Weighted Average Coupon	2.89%	2.89%
Held by consolidated trusts | Single-family Adjustable-rate | Single-family
Debt Instrument [Line Items]
UPB	$ 32,837	$ 38,361
Debt, Net	$ 33,474	$ 39,153
Weighted Average Coupon	3.28%	3.12%
Held by consolidated trusts | Single-family Interest-only | Single-family
Debt Instrument [Line Items]
UPB	$ 4,608	$ 5,322
Debt, Net	$ 4,677	$ 5,386
Weighted Average Coupon	4.72%	4.41%
Held by consolidated trusts | FHA/VA | Single-family
Debt Instrument [Line Items]
UPB	$ 665	$ 720
Debt, Net	$ 680	$ 736
Weighted Average Coupon	4.69%	4.78%

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Fair Value Disclosures - Fair Value Assets Measured on Nonrecurring Basis Valuation Techniques (Details) - Fair Value, Measurements, Nonrecurring	9 Months Ended	12 Months Ended
	Sep. 30, 2019 USD ($)	Dec. 31, 2018 USD ($)
Assets, Fair Value Disclosure [Abstract]
Mortgage Loans Fair Value Disclosure	$ 3,730,000,000	$ 7,543,000,000
Level 3
Assets, Fair Value Disclosure [Abstract]
Mortgage Loans Fair Value Disclosure	3,301,000,000	7,519,000,000
Level 3 | Mortgage loans | Minimum | Internal model
Assets, Fair Value Disclosure [Abstract]
Fair Value Inputs Historical Sale Proceeds	$ 3,110	$ 3,000
Housing Sales Index	0.45%	0.44%
Level 3 | Mortgage loans | Minimum | Median of external sources
Assets, Fair Value Disclosure [Abstract]
External Pricing Source(s)	30.4	36.2
Level 3 | Mortgage loans | Maximum | Internal model
Assets, Fair Value Disclosure [Abstract]
Fair Value Inputs Historical Sale Proceeds	$ 671,825	$ 750,500
Housing Sales Index	3.52%	4.80%
Level 3 | Mortgage loans | Maximum | Median of external sources
Assets, Fair Value Disclosure [Abstract]
External Pricing Source(s)	95.0	94.6
Level 3 | Mortgage loans | Weighted Average | Internal model
Assets, Fair Value Disclosure [Abstract]
Fair Value Inputs Historical Sale Proceeds	$ 185,551	$ 177,725
Housing Sales Index	1.13%	1.08%
Level 3 | Mortgage loans | Weighted Average | Median of external sources
Assets, Fair Value Disclosure [Abstract]
External Pricing Source(s)	85.1	82.5

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Mortgage Loans and Loan Loss Reserves (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($) numberofloans	Sep. 30, 2018 USD ($) numberofloans	Sep. 30, 2019 USD ($) numberofloans	Sep. 30, 2018 USD ($) numberofloans	Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivables [Line Items]
Noncash acquisition, mortgage loans held-for-investment acquired in exchange for issuance of debt securities of consolidated trusts			$ 162,700	$ 122,600
Transfers from advances to lenders to loans HFI			28,600	18,800
Credit to advances to lender cash path			$ 1,600	$ 100
Single-family
Accounts, Notes, Loans and Financing Receivables [Line Items]
Number of Loans, Modifications, Subsequent Default | numberofloans	3,563	4,055	11,644	11,072
Post-TDR Recorded Investment, Modifications, Subsequent Default	$ 443	$ 586	$ 1,367	$ 1,646
Interest rate reduction and term extension types, percentage of completed modifications	9.00%	9.00%	8.00%	12.00%
Principal forebearance and interest rate reductions and term extension types, percentage of completed modifications	23.00%	21.00%	24.00%	24.00%
Average term extension, number of months of completed modifications	188 months	110 months	177 months	126 months
Average interest rate reduction, percentage of completed modifications	0.20%	0.20%	0.10%	0.30%
Multifamily
Accounts, Notes, Loans and Financing Receivables [Line Items]
Number of Loans, Modifications, Subsequent Default | numberofloans	0	0	0	0
Post-TDR Recorded Investment, Modifications, Subsequent Default	$ 0	$ 0	$ 0	$ 0
Held by Freddie Mac
Accounts, Notes, Loans and Financing Receivables [Line Items]
Allowance for loan losses as a percentage of recorded investment of mortgage loans, held for investment	3.80%		3.80%		6.60%
Held by consolidated trusts
Accounts, Notes, Loans and Financing Receivables [Line Items]
Allowance for loan losses as a percentage of recorded investment of mortgage loans, held for investment	0.10%		0.10%		0.20%
Other loss mitigation activities
Accounts, Notes, Loans and Financing Receivables [Line Items]
Number of Loans, Modifications, Subsequent Default | numberofloans			3,983	6,487
Post-TDR Recorded Investment, Modifications, Subsequent Default			$ 400	$ 800

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Mortgage Loans and Loan Loss Reserves - Recorded Investment of Multifamily Held-for-Investment Loans by Credit Quality Indicator (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 1,961,226	$ 1,891,495
Multifamily
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	16,899	15,030
Pass | Multifamily
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	16,684	14,648
Special Mention | Multifamily
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	66	201
Substandard | Multifamily
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	149	181
Doubtful | Multifamily
Financing Receivable, Credit Quality Indicator [Line Items]
Recorded investment of held-for-investment loans	$ 0	$ 0

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Securitization Activities and Consolidation (Tables)

9 Months Ended

Sep. 30, 2019

Securitization Activities and Consolidation [Abstract]

Table - Schedule of Various Interest Entities

The table below presents the carrying value and classification of the assets and liabilities of consolidated VIEs on our condensed consolidated balance sheets.

Table 3.1 - Consolidated VIEs

(In millions)	As of September 30, 2019		As of December 31, 2018
Condensed Consolidated Balance Sheet Line Item
Assets:
Cash and cash equivalents (includes $3,494 and $566 of restricted cash and cash equivalents)		$3,495		$567
Securities purchased under agreements to resell	21,400		12,125
Investments in securities, at fair value	766		—
Mortgage loans held-for-investment	1,905,633		1,842,850
Accrued interest receivable	6,109		5,914
Other assets	12,093		1,631
Total assets of consolidated VIEs		$1,949,496		$1,863,087
Liabilities:
Accrued interest payable		$5,519		$5,335
Debt, net	1,869,308		1,792,677
Total liabilities of consolidated VIEs		$1,874,827		$1,798,012

The following table presents the carrying amounts and classification of the assets and liabilities recorded on our condensed consolidated balance sheets related to non-consolidated VIEs with which we were involved in the design and creation and have a significant continuing involvement, as well as our maximum exposure to loss and total assets of the VIEs.

Table 3.2 - Non-Consolidated VIEs

(In millions)	As of September 30, 2019		As of December 31, 2018
Assets and Liabilities Recorded on our Condensed Consolidated Balance Sheets(1)
Assets:
Investments in securities, at fair value		$39,091		$44,020
Accrued interest receivable	214		235
Derivative assets, net	12		1
Other assets	3,737		3,119
Liabilities:
Derivative liabilities, net	89		88
Other liabilities	3,511		3,049
Maximum Exposure to Loss	268,269		241,055
Total Assets of Non-Consolidated VIEs	320,221		284,724

(1)

Includes our variable interests in REMICs and Strips, commingled Supers, K Certificates, SB Certificates, certain senior subordinate securitization structures, other securitization products, and other risk transfer securitizations that we do not consolidate.

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Legal Contingencies

9 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

LEGAL CONTINGENCIES

Legal Contingencies

We are involved as a party in a variety of legal and regulatory proceedings arising from time to time in the ordinary course of business including, among other things, contractual disputes, personal injury claims, employment-related litigation, and other legal proceedings incidental to our business. We are frequently involved, directly or indirectly, in litigation involving mortgage foreclosures. From time to time, we are also involved in proceedings arising from our termination of a seller's or servicer's eligibility to sell loans to, and/or service loans for, us. In these cases, the former seller or servicer sometimes seeks damages against us for wrongful termination under a variety of legal theories. In addition, we are sometimes sued in connection with the origination or servicing of loans. These suits typically involve claims alleging wrongful actions of sellers and servicers. Our contracts with our sellers and servicers generally provide for indemnification of Freddie Mac against liability arising from sellers' and servicers' wrongful actions with respect to loans sold to or serviced for Freddie Mac.

Litigation and claims resolution are subject to many uncertainties and are not susceptible to accurate prediction. In accordance with the accounting guidance for contingencies, we reserve for litigation claims and assessments asserted or threatened against us when a loss is probable (as defined in such guidance) and the amount of the loss can be reasonably estimated.

Putative Securities Class Action Lawsuit: Ohio Public Employees Retirement System vs. Freddie Mac, Syron, Et Al.

This putative securities class action lawsuit was filed against Freddie Mac and certain former officers on January 18, 2008 in the U.S. District Court for the Northern District of Ohio purportedly on behalf of a class of purchasers of Freddie Mac stock from August 1, 2006 through November 20, 2007. FHFA later intervened as Conservator, and the plaintiff amended its complaint on several occasions. The plaintiff alleged, among other things, that the defendants violated federal securities laws by making false and misleading statements concerning our business, risk management, and the procedures we put into place to protect the company from problems in the mortgage industry. The plaintiff seeks unspecified damages and interest, and reasonable costs and expenses, including attorney and expert fees.

In October 2013, defendants filed motions to dismiss the complaint. In October 2014, the District Court granted defendants' motions and dismissed the case in its entirety against all defendants, with prejudice. In November 2014, plaintiff filed a notice of appeal in the U.S. Court of Appeals for the Sixth Circuit. On July 20, 2016, the Court of Appeals reversed the District Court's dismissal and remanded the case to the District Court for further proceedings. On August 14, 2018, the District Court denied the plaintiff's motion for class certification. On January 23, 2019, the Court of Appeals denied plaintiff's petition for leave to appeal that decision.

At present, it is not possible for us to predict the probable outcome of this lawsuit or any potential effect on our business, financial condition, liquidity, or results of operations. In addition, we are unable to reasonably estimate the possible loss or range of possible loss in the event of an adverse judgment in the foregoing matter due to the following factors, among others: pre-trial litigation is inherently uncertain; while the District Court denied plaintiff's motion for class certification, this denial may be appealed upon the entry of final judgment; and the District Court has not yet ruled upon motions for summary judgment. In particular, absent a final resolution of whether a class will be certified, the identification of a class if one is certified, and the identification of the alleged statement or statements that survive dispositive motions, we cannot reasonably estimate any possible loss or range of possible loss.

LIBOR Lawsuit

On March 14, 2013, Freddie Mac filed a lawsuit in the U.S. District Court for the Eastern District of Virginia against the British Bankers Association and the 16 U.S. Dollar LIBOR panel banks and a number of their affiliates. The case was subsequently transferred to the U.S. District Court for the Southern District of New York. The complaint alleges, among other things, that the defendants fraudulently and collusively depressed LIBOR, a benchmark interest rate indexed to trillions of dollars of financial products, and asserts claims for antitrust violations, breach of contract, tortious interference with contract, and fraud. Freddie Mac filed an amended complaint in July 2013, and a second amended complaint in October 2014. In August 2015, the District Court dismissed the portion of our claim related to antitrust violations and fraud and we filed a motion for reconsideration. On March 31, 2016, the District Court granted a portion of our motion, finding personal jurisdiction over certain defendants, and denied the portion of our motion with respect to statutes of limitation for our fraud claims. Subsequently, in a related case, the U.S. Court of Appeals for the Second Circuit reversed the District Court's dismissal of certain plaintiffs' antitrust claims and remanded the case to the District Court for consideration of whether, among other things, the plaintiffs are "efficient enforcers" of the antitrust laws.

On December 20, 2016, after briefing and argument on the defendants' renewed motions to dismiss on personal jurisdiction and efficient enforcer grounds, the District Court denied defendants' motions in part and granted them in part. The District Court held that Freddie Mac is an efficient enforcer of the antitrust laws, but dismissed on personal jurisdiction grounds Freddie Mac's antitrust claims against all defendants except HSBC USA, N.A. Then, in an order issued February 2, 2017, the District Court effectively dismissed Freddie Mac's remaining antitrust claim against HSBC USA, N.A. At present, Freddie Mac's breach of contract actions against Bank of America, N.A., Barclays Bank, Citibank, N.A., Credit Suisse, Deutsche Bank, Royal Bank of Scotland, and UBS AG are its only claims remaining in the District Court.

On February 23, 2018, the Second Circuit reversed the District Court's dismissal of certain plaintiffs' state law fraud and unjust enrichment claims on statutes of limitations grounds. While Freddie Mac was not a party to the appeal, this decision could have the effect of reinstating Freddie Mac's fraud claims against the above-named defendants. The Second Circuit also reversed certain aspects of the District Court's personal jurisdiction rulings and remanded with instructions to allow the named appellant to amend its complaint. The District Court subsequently granted in part Freddie Mac's motion for leave to amend its complaint, and Freddie Mac amended its complaint on April 16, 2019.

Litigation Concerning the Purchase Agreement

Since July 2013, a number of lawsuits have been filed against us concerning the August 2012 amendment to the Purchase Agreement, which created the net worth sweep dividend provisions of the senior preferred stock. The plaintiffs in the lawsuits allege that they are holders of common stock and/or junior preferred stock issued by Freddie Mac and Fannie Mae. (For purposes of this discussion, junior preferred stock refers to the various series of preferred stock of Freddie Mac and Fannie Mae other than the senior preferred stock issued to Treasury.) It is possible that similar lawsuits will be filed in the future. The lawsuits against us are described below.

Litigation in the U.S. District Court for the District of Columbia

In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations. This case is the result of the consolidation of three putative class action lawsuits: Cacciapelle and Bareiss vs. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation and FHFA, filed on July 29, 2013; American European Insurance Company vs. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation and FHFA, filed on July 30, 2013; and Marneu Holdings, Co. vs. FHFA, Treasury, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation, filed on September 18, 2013. (The Marneu case was also filed as a shareholder derivative lawsuit.) A consolidated amended complaint was filed in December 2013. In the consolidated amended complaint, plaintiffs allege, among other items, that the August 2012 amendment to the Purchase Agreement breached Freddie Mac's and Fannie Mae's respective contracts with the holders of junior preferred stock and common stock and the covenant of good faith and fair dealing inherent in such contracts. Plaintiffs sought unspecified damages, equitable and injunctive relief, and costs and expenses, including attorney and expert fees.

The Cacciapelle and American European Insurance Company lawsuits were filed purportedly on behalf of a class of purchasers of junior preferred stock issued by Freddie Mac or Fannie Mae who held stock prior to, and as of, August 17, 2012. The Marneu lawsuit was filed purportedly on behalf of a class of purchasers of junior preferred stock and purchasers of common stock issued by Freddie Mac or Fannie Mae over a not-yet-defined period of time.

Arrowood Indemnity Company vs. Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, FHFA, and Treasury. This case was filed on September 20, 2013. The allegations and demands made by plaintiffs in this case were generally similar to those made by the plaintiffs in the In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations case described above. Plaintiffs in the Arrowood lawsuit also requested that, if injunctive relief were not granted, the Arrowood plaintiffs be awarded damages against the defendants in an amount to be determined including, but not limited to, the aggregate par value of their junior preferred stock, the total of which they stated to be approximately $42 million.

American European Insurance Company, Cacciapelle, and Miller vs. Treasury and FHFA. This case was filed as a shareholder derivative lawsuit, purportedly on behalf of Freddie Mac as a "nominal" defendant, on July 30, 2014. The complaint alleged that, through the August 2012 amendment to the Purchase Agreement, Treasury and FHFA breached their respective fiduciary duties to Freddie Mac, causing Freddie Mac to suffer damages. The plaintiffs asked that Freddie Mac be awarded compensatory damages and disgorgement, as well as attorneys' fees, costs, and other expenses.

FHFA, joined by Freddie Mac and Fannie Mae, moved to dismiss the In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations case and the other related cases in January 2014. Treasury filed a motion to dismiss the same day. In September 2014, the District Court granted the motions and dismissed the plaintiffs' claims. All plaintiffs appealed that decision, and on February 21, 2017, the U.S. Court of Appeals for the District of Columbia Circuit affirmed in part and remanded in part the decision granting the motions to dismiss. The Court of Appeals affirmed dismissal of all claims except certain claims seeking monetary damages for breach of contract and breach of implied duty of good faith and fair dealing. In March 2017, certain institutional and class plaintiffs filed petitions for panel rehearing with respect to certain

claims. On July 17, 2017, the Court of Appeals granted the petitions for rehearing and issued a modified decision, which permitted the institutional plaintiffs to pursue the breach of contract and breach of implied duty of good faith and fair dealing claims that had been remanded. The Court of Appeals also removed language related to the standard to be applied to the implied duty claims, leaving that issue for the District Court to determine on remand. On October 16, 2017, certain institutional and class plaintiffs filed petitions for a writ of certiorari in the U.S. Supreme Court challenging whether HERA's prohibition on injunctive relief against FHFA bars judicial review of the net worth sweep dividend provisions of the August 2012 amendment to the Purchase Agreement, as well as whether HERA bars shareholders from pursuing derivative litigation where they allege the conservator faces a conflict of interest. The Supreme Court denied the petitions on February 20, 2018. On November 1, 2017, certain institutional and class plaintiffs and plaintiffs in another case in which Freddie Mac was not originally a defendant, Fairholme Funds, Inc. v. FHFA, Treasury, and Federal National Mortgage Association, filed proposed amended complaints in the District Court. Each of the proposed amended complaints names Freddie Mac as a defendant for breach of contract and breach of the covenant of good faith and fair dealing claims as well as for new claims alleging breach of fiduciary duty and breach of Virginia corporate law. On January 10, 2018, FHFA, Freddie Mac, and Fannie Mae moved to dismiss the amended complaints. On September 28, 2018, the District Court dismissed all of the claims except those alleging breach of the implied covenant of good faith and fair dealing. Discovery is ongoing.

Angel vs. The Federal Home Loan Mortgage Corporation et al. This case was filed pro se on May 21, 2018 against Freddie Mac, Fannie Mae, certain current and former directors of Freddie Mac and Fannie Mae, and FHFA as a nominal defendant. The complaint alleged, among other things, breach of contract, breach of the implied covenant of good faith and fair dealing, and that defendants aided and abetted the government's "avoidance" of plaintiff's dividend rights. On March 6, 2019, the U.S. District Court for the District of Columbia granted the defendants' motion to dismiss the case. On March 18, 2019, Mr. Angel filed a motion seeking to alter or amend the judgment and for leave to file an amended complaint. On May 24, 2019, the District Court denied Mr. Angel's motion, and on June 19, 2019, Mr. Angel filed a notice of appeal to the U.S. Court of Appeals for the District of Columbia Circuit.

Litigation in the U.S. Court of Federal Claims

Reid and Fisher vs. the United States of America and Federal Home Loan Mortgage Corporation. This case was filed as a derivative lawsuit, purportedly on behalf of Freddie Mac as a "nominal" defendant, on February 26, 2014. The complaint alleges, among other items, that the net worth sweep dividend provisions of the senior preferred stock constitute an unlawful taking of private property for public use without just compensation. The plaintiffs ask that Freddie Mac be awarded just compensation for the U.S. government's alleged taking of its property, attorneys' fees, costs, and other expenses. On March 8, 2018, the plaintiffs filed an amended complaint under seal, with a redacted copy filed on November 14, 2018. Defendants filed a motion to dismiss on August 1, 2018 and an amended motion to dismiss on October 1, 2018.

Fairholme Funds, Inc., et al. vs. the United States of America, Federal National Mortgage Association, and Federal Home Loan Mortgage Corporation. This case was originally filed on July 9, 2013 against the United States of America. On March 8, 2018, plaintiffs filed an amended complaint under seal. A redacted public version was filed on May 11, 2018 and adds Freddie Mac and Fannie Mae as nominal defendants. The amended complaint alleges, among other items, that the net worth sweep dividend provisions of the senior preferred stock constitute an unlawful taking or exaction of private property for public use without just compensation, and that by enacting the net worth sweep, the government breached the fiduciary duty it owed to Freddie Mac and Fannie Mae, and implied-in-fact contracts between the United States on the one hand and Freddie Mac and Fannie Mae on the other. The plaintiffs ask that plaintiffs, Freddie Mac, and Fannie Mae be awarded (1) just compensation for the government's alleged taking or exaction of their property, (2) damages for the government's breach of fiduciary duties, and (3) damages for the government's breach of the alleged implied-in-fact contracts. In addition, plaintiffs seek pre- and post-judgment interest, attorneys' fees, costs, and other expenses. Defendants filed a motion to dismiss on August 1, 2018 and an amended motion to dismiss on October 1, 2018.

Perry Capital LLC vs. the United States of America, Federal National Mortgage Association, and Federal Home Loan Mortgage Corporation. This case was filed as a derivative lawsuit, purportedly on behalf of Freddie Mac and Fannie Mae as "nominal" defendants, on August 15, 2018. The complaint alleges, among other items, that the net worth sweep dividend provisions of the senior preferred stock constitute an unlawful taking of private property for public use without just compensation or an illegal exaction in violation of the Fifth Amendment, and that by enacting the net worth sweep, the government breached the fiduciary duty it owed to Freddie Mac and Fannie Mae, and implied-in-fact contracts between the United States on the one hand and Freddie Mac and Fannie Mae on the other. The plaintiffs ask that plaintiffs, Freddie Mac, and Fannie Mae be awarded just compensation for the government's alleged taking of their property or damages for the illegal exaction; damages for the government's breach of fiduciary duties; and damages for the government's breach of the alleged implied-in-fact contracts. The proceedings have been stayed pending a ruling on defendants' motion to dismiss in the Fairholme Funds, Inc. litigation.

At present, it is not possible for us to predict the probable outcome of the lawsuits discussed above in the U.S. District Courts and the U.S. Court of Federal Claims (including the outcome of any appeal) or any potential effect on our business, financial condition, liquidity, or results of operations. In addition, we are unable to reasonably estimate the possible loss or range of possible loss in the event of an adverse judgment in the foregoing matters due to a number of factors, including the inherent uncertainty of pre-trial litigation. In addition, with respect to the In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase

Agreement Class Action Litigations case, the plaintiffs have not demanded a stated amount of damages they believe are due, and the Court has not certified a class.

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Regulatory Capital Regulatory Capital - Net Worth and Minimum Capital (Details) - USD ($) $ in Millions	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Net Worth and Minimum Capital [Abstract]
GAAP net worth (deficit)	$ 6,674	$ 4,826	$ 4,477	$ 5,559	$ 4,585	$ (312)
Core capital (deficit)	(66,556)		(68,036)
Minimum capital requirement	18,817		17,553
Minimum capital surplus (deficit)	$ (85,373)		$ (85,589)