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Last Updated: Monday, 20 August 2007, 22:53 GMT 23:53 UK
US mortgage lender sells assets
Sign advertises a repossessed home for sale in California
Mortgage firms have been hit by sub-prime mortgage defaults
US mortgage lender Thornburg has sold $20.5bn (10.3bn) of assets and reduced its borrowings amid a tough market for home loans.

The firm said the move would enable it to meet its financing obligations and continue mortgage lending operations.

Thornburg's shares ended 10.2% lower after the firm said it had written down the value of some home loans.

The US mortgage sector has been hit by defaults on sub-prime loans as higher interest rates have hit consumers.

The problems from the US sub-prime sector have rippled through the world's stock markets in the past few weeks, leading to big share sell-offs.

"Investors' confidence in the mortgage financing space is not doing well," said Larry Goldstone, Thornburg's chief operating officer, in an interview with CNBC television.

Last week, Countrywide, the largest mortgage lender in the US, said it had borrowed $11.5bn to continue making home loans, and a report in the Wall Street Journal on Monday said the firm had begun laying off staff.

Other mortgage lenders in the US, especially those in the sub-prime market, have been forced to refinance their debts.

On Monday Luminent Capital, a West Coast-based real estate investment trust, said it was facing losses of $2.3bn on defaulted mortgage obligations, and that the market in secondary mortgage debt had "seized up."

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