...Mr. Johnson led Fannie Mae from 1991 to 1998. He and Countrywide's Mr. Mozilo worked together to streamline the underwriting process. Mr. Mozilo told Dow Jones in 1995 that he was "working very closely ... with Jim Johnson of Fannie Mae to come up with a rational method of making the process more efficient by the use of credit scoring." Their efforts helped to lead to a boom in mortgage lending that brought huge profits to both companies but is now ending badly....
...Mr. Johnson returned to Countrywide several times to finance his growing real-estate holdings. In November 2001, he received a Countrywide loan of $1.3 million for a home in Palm Desert, Calif. The rate was 5.250% for five years, then became adjustable. Rates on such loans averaged about 6% to 6.2% about that time, HSH says.
In June 2003, Mr. Johnson obtained a $971,650 mortgage on a house in upper northwest Washington, D.C., with a rate of 3.875% for the first five years. About that time, the market average was about 4.3% to 4.9%, according to HSH.
In January 2006, Mr. Johnson got a $5 million home-equity line of credit from Countrywide on a residence in Ketchum, Idaho, near the Sun Valley ski resort. And in December 2007 he received a Countrywide home-equity line of credit for $1.01 million and executed a $1 million promissory note in connection with that home....
...Mr. Raines, who succeeded Mr. Johnson at Fannie's helm at the end of 1998, became a repeat customer of Countrywide while he was CEO. Two days before Christmas in 1999, Mr. Raines got a $1 million loan on his house in upper northwest Washington, D.C., refinancing it in November 2001. Property records don't show the interest rate in either case.
In April 2003, Mr. Raines refinanced again with Countrywide, this time getting a 5.125% rate for the first 10 years. According to HSH, the average rate for such a loan around that time was about 5.5% to 5.7%.
On July 31, 2003, Mr. Raines refinanced again, this time shaving a full percentage point off his initial rate, to 4.125%. The market rate at that period averaged about 5.1% to 5.4%, HSH data show....
...Mr. Raines, was forced to retire from Fannie Mae in 2004 when its regulator found it had violated accounting rules in an effort to conceal fluctuations in profit and hadn't maintained adequate risk controls. This April he agreed to a settlement that involved a donation of about $1.8 million to charity. He said the settlement was "not an acknowledgment of wrongdoing."...
