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US banks in homes fire sale

MAJOR US banks are preparing to clear their books of troubled mortgages through “short sales”, where homeowners settle debts by selling their properties for less than the mortgage value.

Short sales at banks such as Bank of America, Wells Fargo, JPMorgan Chase and Citigroup are expected to rise this year as house prices continue to fall in some parts of the US, leaving many borrowers with larger mortgages than their homes are worth.The number of homes entering or in foreclosure is also expected to climb to a record 4.3m, from 3.4m in 2009.