WaMu Cuts or Suspends $6B in HELOCs

Washington Mutual, one of the nation's largest second-lien lenders, has terminated or suspended $6 billion in available home-equity lines of credit. According to a report in the San Francisco Business Times, the thrift will be sending out a notice to affected HELOC borrowers in the next few days. Seattle-based WaMu joins other lenders - including Countrywide Financial Corp., Bank of America and JPMorgan Chase - that have capped out certain HELOC borrowers or terminated unused lines. To date, most of the action has been in area codes suffering from large home price declines where borrowers have lost equity. As Mortgage Wire went to press today, a WaMu spokesman could not be reached for comment. In the fourth quarter, the thrift ranked third among second-lien lenders, according to the Alternative Products Quarterly Data Report.