Posted By: Brad Martin

NEW YORK (Reuters) - The slowdown of the U.S. housing
market will last through 2007 as inventories are pared enough
to prompt a change in consumer psychology, the chief executive
officer of the nation's biggest mortgage lender said on
Tuesday.
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Mortgage lending has slowed as rising inventories in the
housing market led to a "hard landing" for the industry after a
decade of strong growth, Countrywide Financial Corp. (NYSE:CFC - news)
CEO Angelo Mozilo said at a Merrill Lynch & Co. conference in
New York.

"We have another year of adjustment, or transition" in the
industry until consumers believe home prices won't decline,
Mozilo said. "Various events will make the change take place
and one of them is" a decline in available homes, he said.

Mozilo said he expects the industry will see lending volume
grow progressively from 2008 to 2010 because of a build-up of
demand. Until then, the industry will continue to consolidate
and eliminate excess capacities.

Calabasas, California-based Countrywide last week said it
has funded $375 billion in residential mortgage loans in the
year through October, down 7 percent from the same period of
2005. Its pipeline of mortgages that haven't yet closed totaled
$61 billion in October, down 14 percent from a year earlier.

Countrywide has also said it would trim more than $500
million of annual costs by year end, in part by firing more
than 2,500 employees.

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