June 13 (Bloomberg) -- U.S. Senators Christopher Dodd and Kent Conrad denied getting advantageous loan terms from Countrywide Financial Corp., the lender criticized by lawmakers over policies blamed for spurring the subprime crisis.

Dodd, who oversees the U.S. mortgage industry as chairman of the Senate Banking Committee, and Conrad, a North Dakota Democrat, received loans through Countrywide's ``V.I.P.'' program, which waived points, fees and borrowing rules for prominent people, Portfolio magazine reported yesterday. Former Housing and Urban Development Secretary Alphonso Jackson was also named in the Portfolio article.

``The Dodds received a competitive rate on their loans,'' Dodd spokesman Bryan DeAngelis said today in a telephone interview. ``They did not seek or anticipate any special treatment and they were not aware of any.'' Conrad issued a statement denying any wrongdoing. Countrywide spokesman Rick Simon didn't immediately return calls seeking comment.

Dodd has pressed lenders to help stem foreclosures amid the worst housing slump since the Great Depression. He and Senator Richard Shelby, the banking panel's top Republican, last month brokered a deal on legislation to create a Federal Housing Administration program to insure refinanced mortgages for borrowers after lenders reduce loan principal. The Senate Banking Committee approved the measure on May 20.

Dodd's Loans

Dodd got two loans in 2003, borrowing $506,000 to refinance his Washington townhouse and $275,042 to refinance a house in East Haddam, Connecticut, Portfolio reported. Countrywide waived three-eighths of a point, or about $2,000, on the first loan, and one-fourth of a point, about $700, on the second, the magazine said citing internal documents.

Conrad received two loans from Countrywide, one for $1 million to refinance a vacation home and another for an eight- unit apartment building in Bismarck, North Dakota, according to Portfolio. Countrywide Chairman Angelo Mozilo told an employee to ``take off one point'' from the vacation-home loan, which saved Conrad $10,700, the magazine said. The apartment loan violated Countrywide's policy of not loaning money for buildings with more than four units, Portfolio said. The story said Mozilo told an employee to make an exception for Conrad.

`Spotless Credit'

In his statement today, Conrad said he received financing from Countrywide though he ``never asked for, expected or was aware of any special treatment'' and ``to leave the impression that I did is a complete lie.'' He said he had ``spotless credit'' when he applied for the loans, made 20 percent down- payments and was ``mortgage free'' when he applied. Conrad said he has neither met nor done any favors for Mozilo.

``I never expect to be treated better than anyone else because I am a U.S. senator,'' Conrad said. ``But I do expect to be treated fairly. And this article certainly does not do that.''

Conrad's 2007 financial disclosure form listed a single Countrywide loan among his liabilities. It says he took out a 30-year fixed-rate mortgage for the apartment building in 2004 with an interest rate of 5.75 percent. Conrad reported the loan is worth $50,001 to $100,000. Dodd's disclosure form makes no reference to Countrywide.

Countrywide, based in Calabasas, California, is being acquired by Charlotte, North Carolina-based Bank of America Corp., the second-biggest U.S. bank, in a deal struck in January after mounting defaults led to concern the biggest U.S. mortgage lender might face bankruptcy.

To contact the reporter on this story: Alison Vekshin in Washington at avekshin@bloomberg.net.

Last Updated: June 13, 2008 13:58 EDT