Rate-Freeze Talk Lifts Lenders

Shares of the big mortgage lenders surged on Friday on news that regulators and industry executives were meeting to flesh out a plan to temporarily freeze interest rate resets on certain subprime adjustable-rate mortgage loans.

Regulators and executives from Citigroup(C Quote), Wells Fargo(WFC Quote), Washington Mutual(WM Quote) and Countrywide Financial(CFC Quote), among others, were close to agreeing on a plan that would extend the teaser rates on subprime mortgages that promoted low interest rates for the first two to three years, but then reset to much higher fixed rates for the majority of the life of the loan, The Wall Street Journal reported.

The plan could be announced as early as next week, the Journal said. ...