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Countrywide Financial Corporation News

Countrywide, ACORN Partner on Guidance for Home Retention Efforts

CALABASAS, Calif. and NEW ORLEANS, Feb. 11 PRNewswire-FirstCall — 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.

About ACORN

Founded in 1970, ACORN is the nation's largest community organization of low- and moderate-income families, with over 350,000 member families organized into more than 1000 neighborhood chapters in 103 cities across the country. ACORN has long been a leader in assuring full compliance with the principles of community reinvestment and financial justice to build assets and stability in American's urban neighborhoods. ACORN stands for the Association of Community Organizations for Reform Now. (http://www.acorn.org)

About Countrywide

Founded in 1969, Countrywide Financial Corporation (NYSE: CFC) is a diversified financial services provider. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services residential and commercial loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. For more information about the Company, visit Countrywide's website at http://www.countrywide.com.

This Press Release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding management's beliefs, estimates, projections, and assumptions with respect to, among other things, the Company's future operations, business plans and strategies, as well as industry and market conditions, all of which are subject to change. Actual results and operations for any future period may vary materially from those projected herein and from past results discussed herein. Factors which could cause actual results to differ materially from historical results or those anticipated include, but are not limited to: increased cost of debt; reduced access to corporate debt markets; unforeseen cash or capital requirements; a reduction in secondary mortgage market investor demand; increased credit losses due to downward trends in the economy and in the real estate market; increases in the delinquency rates of borrowers; competitive and general economic conditions in each of our business segments such as slower or negative home price appreciation; changes in general business, economic, market and political conditions in the United States and abroad from those expected; reduction in government support of homeownership; the level and volatility of interest rates; changes in interest rate paths; changes in debt ratings; changes in generally accepted accounting principles or in the legal, regulatory and legislative environments in which Countrywide operates; the judgments and assumptions made by management regarding accounting estimates and related matters; the ability of management to effectively implement the Company's strategies; and other risks noted in documents filed by the Company with the Securities and Exchange Commission from time to time. Words like "believe," "expect," "anticipate," "promise," "plan," and other expressions or words of similar meanings, as well as future or conditional verbs such as "will," "would," "should," "could," or "may" are generally intended to identify forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements or any other information contained herein.

SOURCE Countrywide Financial Corporation; ACORN