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Your Home–

the Ultimate Financial Power Tool

Take control of your finances and
find the home loan that’s right for
you with the help of the valuable
information in this guide from
Countrywide Home Loans.

Find the home loan that’s right for you
with the help of the valuable information
in this guide from Countrywide Home
Loans, part of the Countrywide®
Financial Corporation, America’s #1
Home Lender1. With a wide range of
loan options, Countrywide has one of
the most powerful arrays of loan
programs in the industry and can
offer home loan solutions for almost
any financial situation.

In fact, Countrywide created its Full Spectrum that are designed to help borrowers qualify
Lending division to specialize in finding flexible quickly and easily. We’ve filled this home loan
financial solutions for borrowers who are guide with information you need to help you
self-employed, have high consumer debt or choose the right loan for your situation. Our
less-than-perfect credit histories. Backed by hope is that you are able to use the information
Countrywide Home Loans’ industry-leading presented here to enjoy the benefits and
expertise, resources and technology, its Full financial power of home ownership more
Spectrum Lending division has loan programs than ever.

• Your Home – The Ultimate Financial Power Tool
• Choosing the Right Loan for You
• 8 Critical Questions to Ask when Choosing a Lender
• The Options You Want. The Choices You Need

Your Home
—the Ultimate Financial Power Tool
You already have access to what may be the most powerful For example, homeowners with high balances on multiple
financial tool available to help you reach your financial credit cards can often pay off those credit cards and even
goals - your home. other debts by refinancing their existing home loan.

The experts at Countrywide Home Loans want to help you Let’s look at an example of how a refinance loan could
make the smart financial move with a home loan that lets consolidate and pay off debt, save on monthly mortgage and
you take control by consolidating debt and possibly even credit card payments, and often provide you with additional
lowering your monthly payments. tax deductions (consult your tax advisor).

Current Balance Monthly Payment New Payment

Home Loan $152,000 $1,132 $1,361

Credit Card #1 $10,000 $300 $0

Credit Card #2 $12,000 $360 $0

Credit Card #3 $8,000 $240 $0

Total $182,000 $2,032 $1,361

Refinance Loan: $190,000 Total Savings: $670 each month!

If a homeowner with the financial scenario above consolidated his/her higher interest debt using the
equity from their home, then that homeowner would have a mortgage payment each month of only
$1,361, with total monthly savings of $670.75!
The above scenario is based on the following: Original loan terms assume a $155,000 1st Mortgage, with 7.95% interest. Credit card payment assumes 3% of balance.
The refinance loan terms assume a 3-year fixed adjustable (3/27): 3-year pre-pay, 2 points, 7.75% interest with an 8.87% APR. Does not include tax and insurance.

Choosing the Right Loan for You
Finding the right home loan for your specific situation depends on
many different factors, including:

• What is your present financial status?
• Are you on a fixed income or do you receive
annual pay raises and/or bonuses?
• Are your finances likely to change?
• How long do you expect to live in your house?
• Do you mind if your payment changes during
the term of the loan?
The financial experts at Countrywide Home Loans can help you find
• Do you have money saved for that proverbial
“rainy day” and its unexpected or the answers to these questions and others you might have. To help
emergency expenses? you use the financial advantages of homeownership more effectively,
here is a brief description of the basic types of home loans available:

Loan Type Mortgage How is Interest Typical Terms A Smart Choice For
Terms Rate Set? Homeowners Who:

1st Fixed Rate Interest rate is 15, 20, 25 and Plan to stay in their home for
Mortgage influenced by 10- 30 years more than 5 years and want the
year Treasury bond confidence of long-term
payment stability

Adjustable Interest rate is tied The interest rate Want to live in their homes for a
Rate to the Prime, LIBOR, changes (usually short period; and for buyers who
Treasury or COFI after a set period of need the lowest possible payments
index time) with a limit on in the short term. May also be a
how many good fit for those with assets to
percentage points it manage higher payments. This is a
can increase above good option if your income will likely
the original amount increase in the future.
over the term of
the loan.

Loan Type Mortgage How is Interest Typical Terms A Smart Choice For
Terms Rate Set? Homeowners Who:

1st Combination After the initial Allows homeowners Are burdened with a high amount
Mortgage (Hybrid fixed period, to enjoy the stability of consumer debt (a combination
ARM) interest rate is of a fixed principal rate typically allows for a higher %).
tied to the Prime, and interest payment Want an increased ability to make
Treasury, LIBOR or for 3, 5, 7, or 10 years, on-time mortgage payments which
COFI index after which the rate could help credit standing with the
can usually adjust goal of refinancing at a lower
interest rate later.

2nd Fixed Rate Interest rate is fixed 15 years Want a specific sum of money for a
Mortgage and usually linked to major life event need, for example:
long-term interest home improvement, debt
rates consolidation, college tuition, to
pay off a car loan or any other
major expense.

Home Interest rate is Payments (like a Want to access their home equity as
Equity Line variable and usually credit card) start they need it and pay as they go. This
of Credit connected to the when the borrower is another good choice for handling
(HELOC) prime rate uses the money. home improvement, debt
Borrowing can last consolidation, college tuition or
from 5 years, usually an unplanned expense.
capping at 10 years,
starting the
repayment period.

125% Loan Interest rate is fixed 15 to 20 years Have no equity in their homes
to Value and usually linked to and need money for handling
(LTV) long-term home improvement, debt
interest rates consolidation, college tuition or
an unplanned expense.

8 Critical Questions to Ask
when Choosing a Lender:
Rates, lenders and conditions are 2 Who will service my loan?
Often the company initially quoting you rates on
not always what they seem. a home loan is only a broker or middleman who
Ask some important questions represents – or will sell your loan to – other
banks or lenders who actually “service” the loan
before you choose a loan. throughout its term. In fact, your loan may be sold
to other lenders more than once, leaving you
with the uncertainty of who to make monthly
1 What is my APR? payments to, where to send correspondence,
The annual percentage rate (APR) reflects the effective new account numbers and knowing whether or not
cost of your loan on a yearly basis taking into account payments have been correctly applied to your loan.
such items as interest, mortgage insurance, most
closing costs, points and loan origination fees. Because Countrywide Home Loans is part of the Countrywide®
of these other costs, this number is often higher than family - America’s #1 residential mortgage servicer.†
a quoted rate. Always ask a lender to calculate the We look forward to having you as a member of the
APR in order to understand the “true cost” of your Countrywide family and to providing you with excellent
loan. If the lender will not or does not openly disclose service for the entire length of your loan term.^
the APR, chances are they are hiding some costs that
will show up at closing. 3 How many applications are approved?
Nobody likes rejection, especially when you’re working
Countrywide Home Loans will show you – in a written hard to find financial solutions. While many of the larger
estimate – the terms of your home loan including its APR banks may not even offer non-prime loans (for borrowers
– with no surprises, no hidden costs, no extra fees tacked with less-than-perfect credit), the approval rate for this
onto your rate just before you sign the papers. category of loan is typically lower than for other types of

Countrywide created its Full Spectrum® Lending division
in order to say “yes” to more borrowers with less-than-
perfect credit. We specialize in understanding the needs
and circumstances of all types of homeowners. As such,
it’s no coincidence that historically we have approved 4
out of 5 submitted loan applications.**

4 How big is the institution behind my loan?
Many companies jump into the home loan market when
rates are low and loan applications are plentiful, only
to disappear and “sell” their loan portfolios when the
opportunities tighten up. At any given time there are
several newcomers making lots of “noise” about getting

you a great loan. For a lender to stay in business for the
long run, however, it takes expertise, experience and

For over 35 years, Countrywide has earned the trust of the
nation’s home-buyers one loan at a time and shares a long
and respected heritage of providing hard-working American
homeowners with innovative, problem-solving loan options.
Home loans are what we do, and we do them better.

5 What is my rate lock?
Be careful! When a loan broker quotes you a low interest
rate on a 15- or 30- year fixed rate loan, be sure to ask
whether that rate is locked for the entire time it takes
to close the loan. Often, the rate you are quoted is at
a lower, 10- or even 30-day rate – much shorter than
the time typically necessary to actually complete all
documents, process and close your loan. This can result
in a higher rate at closing than what you were quoted
originally – a potentially costly difference. Be aware
that if interest rates rise and the lock has expired, you’ll
receive the prevailing rate.

6 What are my loan options? 8 Are you specialists in helping individuals with
It’s difficult to take control of your financial situation less-than-perfect credit loans?
without any choices. Unfortunately, many lenders who With many lenders, your past is an important part
offer a home loan program for borrowers with less- of whether or not you qualify for a new home loan.
than-perfect credit offer just that – a single home loan That’s because most lenders aren’t specialists in finding
program. Take it or leave it. solutions for homeowners with less-than-perfect credit
Leave it, and call Countrywide Home Loans. After all,
we have a wide array of loan programs specifically for Countrywide created its Full Spectrum® Lending division
homeowners who need more understanding and flexibility specifically to offer homeowners with different types
when it comes to their home loan needs. We can often offer of credit histories sound choices to help them take
borrowers at least 2 or 3 options from which to choose. control of their financial lives. It’s why we have such a
wide selection of loan programs and have historically
7 How long will it take to approve my loan? approved 4 out of 5 applicants.**
There are few things more stressful than waiting to
know if you’ve been approved for a loan that can
change the course of your financial future.

Once we’ve received your completed application our goal
is to notify you within 24 hours whether or not you have
been approved for a home loan.
The Options You Want
The Choices You Need
Countrywide Home Loans is the
trusted mortgage lender focused
on helping lower monthly debt
payments at competitive rates.
• W
 ant to lower your monthly
• W
 ant to take control of your
financial life?

Call the financial freedom experts at Countrywide
Home Loans today: 1-888-265-3662

† Source: Inside Mortgage Finance (Feb. 4, 2005), Copyright 2005. Equal Housing Lender. © 2006 Countrywide Home Loans, Inc., 4500 Park Granada, Calabasas,
CA 91302. Trade/servicemarks are the property of Countrywide Financial Corporation and/or
^ As of December 2004, Countrywide Home Loans services 97% of the its subsidiaries. Full Spectrum® Lending is a division of Countrywide Home Loans, Inc. Arizona
loans it originates through its retail and wholesale divisions. Mortgage Banker License Number BK8805; Licensed by the Department of Corporations under
the Calif ornia Residential Mortgage Lending Act; Georgia Reg. #5929; Illinois Residential
**Based on a credit-only review of applications submitted to underwriting at Mortgage Licensee (# 0139) by the Of f ice of Banks and Real Estate, Mortgage Banking
Countrywide’s Full Spectrum Lending Division. Division, 310 South Michigan Av enue, Suite 2130, Chicago, IL 60604, (312) 793-1409; Mas-
sachusetts Mortgage Lender License No. ML 1623; this is not an offer to enter into an interest
rate lock-in agreement under Minnesota law; Licensed by the New Hampshire Banking Depart-
1. Source: *Inside Mortgage Finance (Jan. 28, 2005), Copyright 2005 ment; New Jersey (818) 313-6526, Licensed Mortgage Banker, NJ Department of Banking and
2. Refinancing may increase the total number of monthly payment and/or the total Insurance; Licensed Mortgage Banker, NYS Banking Department; Registered with the
Pennsylvania Banking Department; Rhode Island Lender’s License. Some products may not be
amount paid when compared to your current situation.
available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved.
3. National credit card average rate as of 05/15/05,