Senator Receives Preferential Treatment From Countrywide

Senator Kent Conrad admits he wasn’t aware that Countrywide gave him preferential treatment on his mortgage and donated the equivalent fee to a charity. Senator Christopher Dodd on the other hand also got a loan from Countrywide but denies he was treated any differently. I don’t know if I buy that necessarily. Shame on Countrywide for treating these powerful senators differently than the regular borrower. It only hurts the industry when big companies try to pull this kind of shenanigan.

Now why is this significatn you ask? Well because these two Senators sit on the Senate Banking Committe, and Dodd is in fact the chairman. This committee has been actively seeking ways to regulate the mortgage industry since early last year.

Now, if I were a Senator on this committee, I’d highly recommend not doing any Real Estate transaction until the credit crunch is fully behind us and any legislation has been dealt with. Or, just doing a cash purchase if you must delve into the market.

Here is the story from Bloomberg:

June 14 (Bloomberg) — Senator Kent Conrad said he was given preferential treatment on a mortgage from Countrywide Financial Corp. and will write a $10,500 check to charity.

“It appears Countrywide waived one point on my mortgage,” Conrad, a North Dakota Democrat, said in a statement today in Washington. “Although I did not ask for or know that I was receiving a discount, and even though I was offered a competitive loan from another lender, I do not want to have received preferential treatment.”

Conrad said he also received a loan from Countrywide on an eight-unit apartment building in Bismarck, North Dakota, even though the lender typically serves properties that have four units or less. He said he had decided to refinance that loan with another institution.

Conrad and Senator Christopher Dodd, who oversees the U.S. mortgage industry as chairman of the Senate Banking Committee, were among those who received loans through Countrywide’s “V.I.P.” program, which waived points, fees and borrowing rules for prominent people, Portfolio magazine reported June 12. Dodd has denied receiving preferential treatment.

Full story here.

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