05/22/2009 05:12 am ET Updated May 25, 2011

New Mortgage Subsidies Considered By Treasury, Say Sources

WASHINGTON - The Treasury Department is considering giving banks and investors billions of dollars in fresh incentives to modify troubled mortgages and save homeowners from foreclosure, sources familiar with official deliberations said.

Under one scenario, investors in second liens would receive a cash payment if they agree to ease the terms of troubled loans and accept a smaller return on their mortgage investment, the sources said.

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