Countrywide Home Loans Inc. has formed a new division, Full Spectrum Lending, to offer mortgages directly to households with impaired credit histories. The company had previously been making subprime loans as a wholesaler.

"There are many hardworking people who, for one reason or another, have experienced a short-term financial hardship," said Joe Harvey, president of the division. "These borrowers often have the financial ability to qualify for a loan."

According to Mr. Harvey, the most common factors that create borrowers with subprime credit include divorce, medical bills, job loss or instability, or high debt ratios.

He noted that self-employed borrowers who may have difficulty verifying income and people who own several properties could also be customers.

The company said that the subprime unit's offices would be separate from the other retail offices, and that it was intentionally using a separate name to avoid conflicts.

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