Coyote Blog

Maxed Out Mamma tells us that Fannie Mae may already have huge subprime exposure (emphasis added):

Maybe most voters believe
that FNMA and FHA are just in the conservative loan business.
HAHAHAHAHAHAHAHA. Certainly no "trained journalist" is going to ask any
questions about this topic.

Both Fannie and FHA will go to DTIs of over 60% in some cases. Especially refis. Try this thread on FHA.
If only I had saved down the 100 odd links or so I've run into over the
last year about how brokers were getting loans that the subprime
companies refused (who have since defaulted) through under FNMA!!! The
reason they did it as a last resort was only because FNMA paid less for
the loan. FNMA is already going to run into huge problems because of
the slopover into their portfolio in the interim between most of the
subprime lenders going down and FNMA's meaningful tightening of lending
standards. So FNMA already faces years of worsening financial trouble
without any new risks. Why does OFHEO oppose this? Hmmmm?

You can get information on Fannie's loan types at efanniemae.com. Believe me, they do high LTV, hybrids, 40 year etc. This page will show you information about Fannie's ARM products. Take a look. Take a good look. You want a 100% interest-only? They got it!! In fact, they'll take downpayment assistance, and go up to 105% with special programs. Chortle! Ya want interest-only ARM hybrids with DAP? Sure. BRING IT ON, cries Fannie. Simultaneous seconds? Sure 'nuff!!! (By the way, this is the escape from the refusal of the MI companies to play.)

The
bottom line is that every risk afflicting Alt-A lenders in high-cost
areas can afflict Fannie and really has. It's just that no one is
paying attention.