- 4 - Petitioner was chartered by Congress on July 24, 1970, by the Emergency Home Financing Act of 1970, Pub. L. 91-351, title III (Federal Home Loan Mortgage Corporation Act), 84 Stat. 450. Petitioner was originally exempt from Federal income taxation. However, Congress repealed petitioner’s Federal income tax exemption status in the Deficit Reduction Act of 1984 (DEFRA), Pub. L. 98-369, sec. 177, 98 Stat. 709. Pursuant to this act, petitioner became subject to Federal income taxation, effective January 1, 1985. Petitioner held mortgages in its retained mortgage portfolio or as collateral for issuances of collateralized mortgage obligations (CMOs). In other cases, petitioner, as guarantor of participation certificates (PCs)2 it issued, would reacquire mortgages placed in a PC pool that became delinquent.3 Petitioner routinely acquired real estate by foreclosure when mortgages that it owned became delinquent. In some cases, mortgages that petitioner held, and had never sold, became delinquent. In a number of cases, the ownership of mortgages, which were in default, was transferred to petitioner before January 1, 1985. 2PCs are securities representing beneficial ownership of the principal and interest payments on a pool of mortgages. 3Regardless of the manner in which petitioner acquired the delinquent mortgages, all real estate that petitioner acquired through foreclosure of delinquent mortgages is known as “real estate owned”.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
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