B of A rebranding 'toxic' Countrywide lending operation

In an interview Friday, Desoer offered a preview of the new approach to be offered beginning today, which includes an interactive website with customized tools -- designed "to demystify the lending process," she said. The idea is to educate prospective borrowers about how much home they can reasonably afford and what to expect from the bank as they work their way through the loan process.

Bank of America also is introducing a one-page, plain-language summary of a mortgage's interest rate, terms, potential payment changes and other details of the loan. This "Clarity Commitment" document is to be given to borrowers when they apply and again at closing to supplement more complicated government-required disclosure forms.

Other lenders also have pledged to improve disclosures, often as part of settlements of litigation alleging abusive lending. But complaints of deceptive practices by the industry have continued.

"We're all in favor of borrowers knowing more, but at best disclosure is only a small part of a responsible system of lending," said Caryn Becker, policy counsel at the Oakland office of the Center for Responsible Lending, a nonprofit, nonpartisan organization that advocates restricting controversial loan types and features.

Bank of America Chairman and CEO Kenneth Lewis says he has tried addressing those concerns. After taking over Countrywide, Lewis barred the lender from making subprime mortgages. The company also stopped offering home loans written without verifying borrowers' incomes as well as a type of adjustable-rate mortgage on which borrowers could pay so little that their loan balances rose.

Although he eagerly swore off those former Countrywide staples, Lewis expressed disappointment at consumer surveys conducted by Bank of America showing a rapid disappearance of the goodwill attached to the Countrywide name.

"Even when we bought them, they tested well," Lewis said in a recent interview. "But the negative press, just time and time again, took it down. So they went from first to last" in the surveys.

In the meantime, Countrywide was no longer the undisputed market leader. In the first three months of this year, the mortgage operation of Countrywide and Bank of America originated $85 billion in home loans, ranking the combination No. 2. In first place was Wells Fargo, which, bolstered by its purchase of Wachovia late last year, originated $101 million in mortgages.