Fannie Mae-No Politics (FNMA)

[kthomp19]

Not only do the GSEs need to pay the deferred NWS - the entirety of their profits, they will be paying 10% on that amount

Once they hit full with-buffers capitalization, every quarter they will pay the lesser of 2.5% (10% annualized) of the LP and the increase in net worth from the prior quarter (profits). At that point the LP will stop increasing. Your sentence suggests they would have to pay both.

until the LP is paid down, which can't be done until some date far off in the future!

The LP has never been repayable, and it's hard to tell if Treasury will ever allow it to be. FHFA asked Treasury to allow the seniors to be repayable twice (in 2010 and 2011), and Treasury refused both times. Maybe they will change their mind in the future?