At least five current or former executives at beleaguered Fannie Mae and Freddie Mac are linked to a controversial Countrywide Financial "V.I.P." program that provided mortgages on favorable terms to policymakers and business partners.

The executives include Countrywide's former Washington lobbyist, who recommended key officials for V.I.P. treatment, as well as four beneficiaries of preferential loans, among them a former Congressional staffer specializing in housing issues.

An article in this month's Condé Nast Portfolio discloses how Countrywide gave cut-rate mortgages to congressmen, journalists and other V.I.P.'s in an effort to curry favor.

Countrywide's former Washington lobbyist, Jimmie Williams, who often referred high-profile prospects for special treatment to the lender, currently works as state director for Freddie Mac.

Countrywide's V.I.P. Club

An exclusive look at the Countrywide Financial loan scandal.

They exemplify the close ties between Countrywide and government-sponsored mortgage buyers Fannie Mae and Freddie Mac. That relationship, which worked to the firms' mutual benefit during the real estate boom, has drawn increasing criticism recently as all three narrowly staved off collapse. Bank of America bought Countrywide at a bargain price, while the federal government has pledged to extend credit to or buy stock in Fannie Mae and Freddie Mac if needed. Fannie Mae and Freddie Mac buy mortgages from Countrywide and other lenders and resell them to investors in the secondary market. Depending on the year, Fannie Mae purchased 10 percent to 30 percent of its loans from Countrywide, which became the nation's biggest mortgage lender.

"If Fannie and Freddie catch a cold, I catch the fucking flu," Countrywide co-founder Angelo Mozilo is quoted as saying in Chain of Blame, a new book by Paul Muolo. Now the risky loans that sent Countrywide's share price plummeting and prompted its sale have infected Fannie Mae and Freddie Mac.

Home buyers pay discount points to reduce their interest rates; one point equals 1 percent of the loan. Through V.I.P. mortgages, Countrywide cultivated executives at Fannie and Freddie, members of Congress and their staffs, and government officials.   

Countrywide's former Washington lobbyist, Williams, acting as an intermediary, would send emails flagging the importance of potential V.I.P. clients to Countrywide. A person familiar with Williams' thinking said that he recommended a hodgepodge of prospective customers for loans, from a security guard to elected officials and Congressional staff. He initially directed them to local Countrywide branches, but began hearing complaints that some branches were slow or overwhelmed. To ensure quality service, he referred more of them to the V.I.P. program, based in Countrywide’s Rosemead, California, call center.

In November 2002, Williams urged Doug Perry, a call-center manager, to give "specialized handling" to a loan application from Jones, then senior counsel of the House Financial Services Housing and Community Opportunity Subcommittee. "Jones is also an adviser to ranking Republican members of Congress responsible for legislation of interest to the financial-services industry and of importance to Countrywide," Williams added.