Aug. 23, 2007 (LPAC)--The New York Times reported today that Countrywide Home Loans, the mortgage-loan unit of Countrywide Financial, had a provision in the agreements to sell securities based on mortgages it had bundled, that it would buy back any mortgages if their terms were changed to help the borrowers remain current, i.e. to avoid foreclosure. In its current financial condition, Countrywide is in no position to be buying back mortgages.

As a result, the Times points out (citing analysts), the Countrywide Financial unit which "services" the loans (i.e. deals with the homeowner borrowers) "may have less incentive to help troubled borrowers who are interested in working out their loans because doing so could put the parent company on the hook to buy back the loan."