MORTGAGE

As more banks report write-downs tied to the global credit crunch, analysts say Wachovia Corp may have losses lurking in an area that has garnered less investor attention.

Lenders will have to confirm that a borrower can afford a mortgage before making a loan under protections proposed by the Federal Reserve on Tuesday, following defaults and losses on U.S. subprime mortgages this year.

U.S. lenders would have to determine that a borrower can afford a mortgage before making the loan under a Federal Reserve staff proposal on new regulations released on Tuesday.

Fraudsters are targeting troubled borrowers facing foreclosure in a scheme that could leave homeowners with even more debt than they otherwise would face, a new online video warns.

H&R Block Inc, slammed over the past year by exposure to risky mortgages, on Tuesday reported a bigger-than-expected quarterly loss after shutting down its Option One Mortgage subprime lender, sending its shares down nearly 7 percent.

The government's intervention to streamline the mortgage industry's process for evaluating struggling borrowers was a necessary step, Treasury Secretary Hank Paulson says. No one should lose their home just because a complex, cumbersome process simply couldn't get to them in time to determine if there is another potential solution.

President George W. Bush is expected to unveil a plan on Thursday to prevent a wave of home loan foreclosures that has threatened to knock the U.S. economy into recession and rattled investors worldwide. The plan hammered out by the U.S. Treasury Department in talks with mortgage industry leaders.

President George W. Bush is expected to unveil a plan on Thursday to help struggling American homeowners avoid foreclosure, addressing a mortgage crisis that risks tipping the U.S. economy into recession and has shaken financial markets around the world.

Federal regulators and lenders are homing in on five years as the length of an interest-rate freeze on subprime mortgages, Bloomberg reported, citing a source familiar with the negotiations.

Implementing the proposed bailout of subprime borrowers who face foreclosure may be so difficult that it will turn out to be no better than the loan modification efforts already underway, analysts said.

State and local governments should be permitted to issue tax-exempt bonds that would fund programs to prevent foreclosures, Treasury Secretary Henry Paulson said on Monday. Under the plan, state and local governments could temporarily broaden their tax-free exempt bond programs to include mortgage refinancing, Paulson said.

The Bush Administration is close to agreeing on a pact with major financial institutions that would temporarily freeze interest rates on certain subprime loans, the Wall Street Journal reported Friday, citing sources familiar with the negotiations. The plans' details, which could be announced as soon as next week, are still being ironed out, the Journal said.

Wells Fargo & Co, the second-largest U.S. mortgage lender, said on Tuesday it would take a $1.4 billion fourth-quarter charge largely related to losses on home equity loans as the nation's housing market deteriorates.

Housing and credit troubles took more of a toll on the U.S. economy as prices on pre-owned single-family homes tumbled in the third quarter and consumer confidence in November sank to a two-year low, reports on Tuesday showed.

In May, Alvin Clavon received a foreclosure notice on the simple, Spanish-style house in South Los Angeles that he shares with his wife and three boys.

Mortgage applications fell last week, with demand for both refinancings and home purchases waning, an industry group said on Wednesday. The Mortgage Bankers Association's seasonally adjusted mortgage application index fell 3.6 percent to 681.7 in the week ended November 16.

The Dubai government agency that bought into Deutsche Bank this year said on Monday it was considering investing in U.S. financial services firms affected by the mortgage-market crisis.

Fannie Mae had its biggest two-day decline in 20 years after executives failed to alleviate investor concern following a report that speculated it may have understated its credit losses.

U.S. Treasury Secretary Henry Paulson Friday said a strong dollar is in the nation’s industry, but noted that parts of the subprime housing market will likely worsen over the next few months.

As banks work to clean up some of the subprime mortgage mess, they are finding new obstacles in unraveling the massive paper trail used to pool individual loans into mortgage-backed securities.

Cities in California, Florida and Ohio dominated the 25 U.S. metro areas with the highest home foreclosure rates, though rates jumped in most of the top regions during the third quarter, RealtyTrac said on Wednesday.