Countrywide and ACORN Partner For Foreclosure Prevention

Countrywide Financial Corporation and the Association of Community
Organizations for Reform Now (ACORN), have reached an agreement that will
further enhance the process for helping borrowers who are delinquent on
their subprime loan payments find home retention solutions and avoid
foreclosure.

Countrywide and ACORN have partnered to formalize workout programs for
borrowers with all types of subprime loans, not just hybrid adjustable rate
mortgages (”ARMS”) with pending rate resets. Further, the agreement
addresses home retention options and procedures for borrowers in various
stages of mortgage delinquency, not just borrowers who are current in their
payments. In these ways, the initiative broadens the approaches of
Countrywide’s previously announced $16 billion home retention initiative,
and the industry-backed HOPE NOW(R) alliance program.

“Countrywide and ACORN share the belief that no subprime borrower who
has demonstrated the ability and willingness to make payments should face
foreclosure,” said Maude Hurd, national president of ACORN. “The practices
set out in this historic agreement fill gaps by providing assistance to
borrowers who don’t fit the financial situations covered in the previously
announced initiatives, placing Countrywide and ACORN at the forefront of
assisting more homeowners across the nation stay in their homes. We hope
others in the mortgage servicing industry will adopt similar practices.”

“Countrywide is eager to work with borrowers, whether they are facing
rate resets or some other type of financial difficulty,” said Michael
Gross, managing director of loan administration for Countrywide. “Through
this partnership, Countrywide and ACORN have agreed to a set of home
retention standards to help borrowers who are in various situations of
financial difficulty to establish suitable repayment plans or other
solutions. We are very pleased to join with ACORN and ACORN Housing
counselors in our quest to find affordable home retention solutions for
borrowers, while offering the investors in the loans a more attractive
alternative than foreclosure.”

Countrywide customers experiencing a financial hardship and seeking
further information about workout programs or counseling may call
Countrywide’s Home Retention Division directly at 800-669-6650, or contact
the ACORN Housing call center at 866-67-ACORN for counseling assistance.

Highlights of the agreement include:
– A systematic approach to helping borrowers with subprime hybrid ARMs
who have strong payment records but may face or are already facing
difficulty with higher payments as the result of interest rate resets.
Solutions in these cases include refinancing into a prime loan or a
loan modification program offering a five-year extension of the rate
prior to the reset, consistent with the previously announced programs.
This portion of the initiative is backed up by a proactive outbound
calling and mailing campaign to contact borrowers and discuss their
options.
– For delinquent subprime fixed rate and ARM borrowers who want to stay
in their homes, ACORN counselors and Countrywide home retention
specialists will utilize a streamlined approach to provide affordable
home retention options that include short-term repayment plans or loan
modifications in line with identified affordability standards. Loan
modification solutions include capitalization of arrearages, an
interest rate freeze or rollback to the pre-reset rate, and, under
certain circumstances, an interest rate reduction.

The ACORN-Countrywide standards recognize the importance of ensuring
that investor returns are protected by the home retention options offered
to borrowers. The agreement acknowledges that the company will comply with
its investor contracts and applicable laws, regulations and accounting
standards in its home retention efforts.

Countrywide and ACORN intend to work closely on implementation and
execution of the agreement. Both organizations are committed to ongoing
monitoring of the program and measuring results for all of the borrowers
working with ACORN Housing counselors, who have been offering free services
to thousands of distressed borrowers facing foreclosure.

Countrywide has been proactively working with its borrowers, directly
and through dozens of recognized non-profit counseling programs to find
home retention solutions. In December, Countrywide completed more than
12,000 workout programs, including 10,000 loan modifications, for its
customers. This brought the number of home retention workouts for 2007 to
more than 81,000. Currently, Countrywide is working with more than 100,000
additional borrowers in an attempt to find affordable workout solutions.

ACORN has been one of the nation’s leading community organizations
fighting to retain the dream of homeownership for American families. ACORN
was among the very first to raise the specter of the looming subprime
crisis more than a year ago, and has worked to pass groundbreaking
legislation to prevent predatory lending and promote stronger regulatory
protections to borrowers. ACORN has assisted thousands in recent months
facing the problems of rate resets and potential delinquencies by
organizing Foreclosure Fairs in the most impacted areas in the country.

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