This business about Countrywide Financial giving sweetheart loans to U.S. senators and other Washington big-wigs really needs some looking into. (Here's some backstory.) The LAT reports that the Calabasas-based mortgage company employed a bunch of lobbyists and contributed a bunch of money to the campaigns of senators and representatives. North Dakota Sen. Kent Conrad spoke to Countrywide CEO Angelo Mozilo about financing for a $1.16-million property at the time he was chairman of the Senate Finance Committee. Conrad wound up with a Countrywide loan, reportedly at favorable terms.

In 2004, Countrywide also lent Conrad $96,000 to buy out his two brothers on a Bismarck, N.D., apartment building. At the time, Countrywide normally did not make loans on apartment buildings as large as Conrad's. The senator said he thought he got the exception because he was a good customer, the building was more than half paid for and he had an exceptional credit rating. Also, he said, the junior loan officers he dealt with told him the company's policy on such buildings was changing.

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Although Dodd and Conrad said they received no special favors, disclosure of the loans was proving awkward for them. In part that's because of a federal investigation of Countrywide. Also, Dodd, one of four Senate Democrats who pursued his party's 2008 presidential nomination, has been preparing for a Senate vote on legislation he authored that would create a $300-billion mortgage insurance fund to save an estimated 500,000 borrowers from foreclosure. The measure could reduce losses incurred by Countrywide and other lenders on bad loans. Lobbying records show that Countrywide's representatives have actively lobbied on bills that have gone through Dodd's committee.

From a WSJ editorial this morning:

What did Countrywide CEO Angelo Mozilo receive – or think he would receive – in return for the friendly loans to politicians? And what did Mr. Mozilo get – or think he would get – in return for sweetheart loans to Fannie Mae CEOs Jim Johnson and Franklin Raines? Mr. Conrad says he called Mr. Mozilo at the suggestion of Mr. Johnson, a leading and long-time member of the Democratic Beltway establishment.