Updated from 12:21 a.m. EDT

The board of struggling lender CIT Group ( CIT) approved a deal Sunday evening with some of its major bondholders to help it avert a bankruptcy filing through a $3 billion emergency loan, the New York Times reports, citing people briefed on the matter.

Under the terms of the deal, CIT would receive $3 billion from some of its main bondholders, though at an initial rate of about 10.5%, the Times reports. The money, arranged by Barclays Capital, is meant to give the commercial lender several weeks to set up an exchange of bondholders' debt for equity, alleviating some of the pressure from billions of dollars in obligations, the newspaper notes.

CIT's board approved the deal around 10:30 p.m. Sunday, these people said, the Times reports.

CIT is expected to make an announcement Monday.

It was reported Sunday by the Wall Street Journal that CIT's board was meeting to consider $3 billion in rescue financing from its bondholders.

The Journal reported the deal being considered by CIT charges it with high interest rates, and the deal doesn't permanently fix the company's long-term financing needs.

CIT has been in negotiations with key bondholders -- including bond manager Pimco -- in an attempt to avoid a bankruptcy filing. Reports over the weekend had the lender possibly filing for bankruptcy Monday if a deal wasn't reached.

CIT has been scrambling to raise $2 billion to $4 billion after the federal government refused to bail out the company. Rescue talks with government regulators broke off late Wednesday after days of round-the-clock negotiations.The lender faces $7.4 billion in debt due in the first quarter of next year. Highlighting its woes, CIT was removed from the S&P 500 index Friday.

CIT received $2.3 billion of bailout money from the U.S. government in December.

The Journal, citing the people familiar with the matter, reports the final term sheet still needs to be reviewed by various financial and legal advisers. There is a chance that a final deal could fail over the last-minute talks.

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