Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
FEDERAL HOME LOAN MORTGAGE CORPORATION (Freddie Mac)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Item 8.01 Other Events.
On December 31, 2010, Freddie Mac (formally known as the Federal Home Loan Mortgage Corporation) entered into an agreement with Bank of America, National Association, and two of its affiliates, BAC Home Loans Servicing, LP and Countrywide Home Loans, Inc., to resolve currently outstanding and future claims by Freddie Mac for repurchases arising from the breach of certain selling representations and warranties on certain loans purchased by Freddie Mac from Countrywide Home Loans, Inc. and Countrywide Bank FSB. Under the terms of the agreement, Freddie Mac has received a $1.28 billion cash payment, in consideration for releasing Bank of America and its two affiliates from existing and future repurchase claims arising from the sale to Freddie Mac by the Countrywide entities of loans for which the first regularly scheduled monthly payments were due on or before December 31, 2008. The unpaid principal balance of the loans in this portfolio, as reflected on Freddie Mac's books at November 30, 2010, was approximately $117 billion. The agreement applies only to certain claims for repurchase based on breaches of representations and warranties and the agreement contains specified limitations. The agreement does not cover loans sold to Freddie Mac or serviced for Freddie Mac by other Bank of America entities. We do not anticipate that the agreement will have a material impact on Freddie Mac’s 2010 financial statements.
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 hereunto duly authorized.