DEBT

We have a commercial paper program with qualified institutional investors. We also obtain other short-term funding from the issuance of demand notes to retail investors through our floating rate demand notes program. We have certain securitization programs that issue short-term asset-backed debt securities that are sold to institutional investors. Bank borrowings by several of our international affiliates in the ordinary course of business are an additional source of short-term funding. We obtain long-term debt funding through the issuance of a variety of unsecured and asset-backed debt securities in the U.S. and international capital markets.

Asset-backed debt issued in securitizations is the obligation of the consolidated securitization entity that issued the debt and is payable only out of collections on the underlying securitized assets and related enhancements. This asset-backed debt is not the obligation of Ford Credit or our other subsidiaries.

NOTE 9. DEBT (Continued)

Interest rates and debt outstanding were as follows (in millions):



	Interest Rates
	Average Contractual				Average Effective				Debt
	2013		2012		2013		2012		September 30, 2013			December 31, 2012
Short-term debt
Asset-backed commercial paper	0.3	%	0.4	%					$	4,036		$	5,752
Floating rate demand notes	1.1	%	1.1	%					5,352			4,890
Other asset-backed short-term debt	0.7	%	1.1	%					1,320			3,616
Commercial paper	1.0	%	1.2	%					2,067			1,686
Other short-term debt	5.0	%	4.7	%					1,896			1,434
Total short-term debt	1.3	%	1.1	%	1.4	%	1.1	%	14,671			17,378
Long-term debt
Senior indebtedness
Notes payable within one year									5,749			5,557
Notes payable after one year									36,401			31,656
Asset-backed debt
Notes payable within one year									16,714			13,788
Notes payable after one year									20,792			20,216
Unamortized discount									(103		)	(128		)
Fair value adjustments									259			791
Total long-term debt	3.3	%	3.8	%	3.5	%	4.1	%	79,812			71,880
Total debt	3.0	%	3.3	%	3.1	%	3.5	%	$	94,483		$	89,258

Fair value									$	97,492		$	92,799

With the exception of commercial paper, which is issued at a discount, the average contractual rates reflect the stated contractual interest rate. Average effective rates reflect the average contractual interest rate plus amortization of discounts, premiums, and issuance fees. Fair value adjustments relate to designated fair value hedges of unsecured debt.

The fair value of debt reflects interest accrued but not yet paid of $699 million and $708 million at September 30, 2013 and December 31, 2012, respectively. Interest accrued is reported in Other liabilities and deferred income for outside debt and Accounts payable - affiliated companies for debt with affiliated companies. The fair value of debt also includes $9.3 billion and $8.0 billion of short-term debt at September 30, 2013 and December 31, 2012, respectively, carried at cost which approximates fair value. All debt is categorized within Level 2 of the fair value hierarchy. See Note 12 for additional information.

Debt with affiliated companies included in the above table was as follows (in millions):



	September 30, 2013		December 31, 2012
Other short-term debt	$	25	$	28
Notes payable within one year	6		4
Notes payable after one year	308		340
Total debt with affiliated companies	$	339	$	372

Debt Repurchases and Calls. From time to time and based on market conditions, we may repurchase or call some of our outstanding unsecured and asset-backed debt. If we have excess liquidity and it is an economically favorable use of our available cash, we may repurchase or call debt at a price lower or higher than its carrying value, resulting in a gain or loss on extinguishment.

NOTE 9. DEBT (Continued)

In the third quarter and first nine months of 2013, through market transactions, we called an aggregate principal amount of $0 and $163 million, respectively, (of which none were maturing in 2013) of our unsecured debt. As a result, in the third quarter and first nine months of 2013, we recorded a $0 and $1 million pre-tax loss, respectively, net of unamortized premiums, discounts, and fees in Other income, net. There were no repurchase or call transactions for asset-backed debt during the third quarter and first nine months of 2013.

In the third quarter and first nine months of 2012, through market transactions, we called an aggregate principal amount of $267 million (of which none were maturing in 2012) and repurchased and called $482 million, respectively, of our unsecured and asset-backed debt. As a result, in the third quarter and first nine months of 2012, we recorded a pre-tax loss of $3 million and $12 million, respectively, net of unamortized premiums, discounts, and fees in Other income, net.

Debt Maturities. Short-term and long-term debt matures at various dates through 2048. At September 30, 2013, maturities were as follows (in millions):



	2013 (a)		2014 (b)		2015		2016		2017		Thereafter (c)		Total
Unsecured debt	$	10,449	$	5,912	$	9,271	$	8,212	$	6,219	$	11,402	$	51,465
Asset-backed debt	7,398		17,146		9,333		6,266		2,028		691		42,862
Total	17,847		23,058		18,604		14,478		8,247		12,093		94,327
Unamortized discount													(103		)
Fair value adjustments													259
Total debt													$	94,483

__________


(a)	Includes $12,086 million for short-term and $5,761 million for long-term debt.


(b)	Includes $2,585 million for short-term and $20,473 million for long-term debt.


(c)	Includes $11,393 million of unsecured debt maturing between 2018 and 2023 with the remaining balance maturing after 2031.