The events surrounding Sen. Kent Conrad's favorable home loan deal with Countrywide Financial have shown a spotlight on the complexities of large home loans and offered a rare glimpse of the details of a senator's personal finances.

Conrad, D-N.D., has been alleged to have received special treatment on two loans: a $1.07 million loan in 2004 for a beach house in Bethany Beach, Del., and a $96,000 loan in 2004 on an eight-unit apartment complex in Bismarck. On the former, he got a discount in upfront fees, and on the latter, he received a loan for a type of property that Countrywide usually doesn't issue loans for.

Conrad said in an interview Wednesday that he's concerned the discount he received on upfront costs of a home loan are being construed as a cut in the interest rate on that loan.

The distinction has been unclear in some media reports, including a Tribune editorial that ran Wednesday.

Why does this matter?

Deep in these distinctions of financial jargon is a big difference in the amount of financial benefit Conrad received by getting special treatment.

Conrad's special discount, as ordered by Countrywide CEO Angelo Mozilo, was the reduction of one point, or $10,700 in initial fees. Points, in the world of mortgage initiation fees, are extra money that applicants pay up front to secure a better interest rate for the course of the loan.

"He should have paid $10,000 to get the interest rate Countrywide was offering him," explained Darin Ketterling, owner of American Home Loans in Bismarck. "Countrywide basically waived this and said, 'here's the lower interest rate, anyway.'"

Ketterling said it was impossible to know the exact difference between what Conrad saved by getting a point discount and what he would have saved by getting an interest rate discount. Every company shaves a different level of interest off for one point, and this can fluctuate by the day, he said.

However, even a small interest rate discount, carried over the 15-year life of a $1.07 million loan, would have potential to save him much more money than the fee discount.

Conrad repeated his prior assertions Wednesday that he never asked for any special treatment and was not aware that he was given such treatment, even though he personally asked Mozilo about a loan after phoning a friend who had Mozilo in the room with him.

"(Mozilo) made no commitment," Conrad said. "He never said, 'we're going to give you anything special.' I wasn't looking for any special deal."

As part of an effort at disclosure, Conrad has released the financial details of his transaction.

In 2002, Conrad put $290,000 down on a $1.45 million vacation home in Delaware and received a $1.16 million loan at a 6.125 percent interest for the difference from Countrywide. As interest rates dropped, he refinanced the loan at 5.625 percent in 2003 and again at 4.875 percent in 2004.

It was this last loan on which Conrad received the point discount.

Glenn Schwartz, a mortgage broker from Rockville, Md., who offered Conrad a losing bid on his 2002 loan, confirmed that the 6.125 percent interest rate was a competitive rate at the time.

Schwartz said he was "being competitive" at the time and offered this identical rate to Conrad with no special treatment or consideration for his status as a U.S. senator.

Ketterling, of American Home Loans in Bismarck, said the rate Conrad received on the Bismarck complex is comparable to what was being offered in the area during 2004.

(Reach reporter Jonathan Rivoli at 250-8264 or jonathan.rivoli@;bismarcktribune.com)