Washington Mutual got a new CEO this week - a leader that is now faced with cleaning up a messy portfolio of non-performing mortgages and clients walking away from their debt. On the top of the heap is a whopping $60 billion in home equity loans (including home equity lines of credit).

WaMu has already frozen or closed many home equity lines of credit, despite their customer’s preferences. But, more risky loans remain.

CNN Money reports:

“The Seattle-based thrift gave itself a facelift on Sunday when it ousted its embattled CEO

Kerry Killinger and replaced him with Fishman in the wake of three consecutive quarters of heavy losses. That string of bad quarters, replete with layoffs and the need for new and expensive investment capital, stemmed almost entirely from its large and troubled $181 billion portfolio of home loans.”

It is now becoming more difficult for major lenders to close home equity lines, due to repeated warnings from the FDIC and the Office of Thrift Supervision about following proper regulations.

See Also:

WaMu Cuts $6 billion in Home Equity Lines

WaMu Eliminates HELOC Program

Tags | Heloc, heloc crisis, home equity line of credit, mortgage crisis, Washington Mutual