Monday, February 13, 2012

Details emerge on Rep. Buck McKeon's Countrywide VIP loan

Four years after Countrywide Financial became a symbol of the mortgage meltdown, the company and its questionable dealings have become a potent political issue in the Santa Clarita congressional district held by Republican Howard "Buck" McKeon.

Congressional investigators allege that McKeon and Rep. Elton Gallegly, a Republican colleague whose neighboring district includes much of Ventura County, got cut-rate home loans under a Countrywide VIP program known as "Friends of Angelo," named for the now-defunct Calabasas lender's former chief executive, Angelo Mozilo.

McKeon received a $315,000 mortgage refinance in 1998 as his family-owned business, Howard & Phil's Western Wear, was going through a Chapter 11 bankruptcy, according to documents reviewed by The Times. McKeon was no longer involved in the daily operation of the business after his 1992 election to Congress, but he had retained a stake in it. He saw his income plummet in the years before refinancing his Stevenson Ranch home, financial disclosures and bankruptcy filings show.

In spite of that, McKeon received a favorable rate and wasn't required to produce documentation proving he could repay the mortgage — terms ordered by Mozilo himself, according to documents subpoenaed for a House inquiry.

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