The Office of Thrift Supervision, which regulates U.S. savings and loans, is firing a warning shot across the bow of thrifts looking to boost the amount of certain types of home loans that are a high percentage of, or even exceed, a property's value. San Mateo-based Bay View Capital Corp. had to postpone its agreement to buy PSB Lending Corp. after the company said regulators warned they were reviewing the guidelines that govern thrifts. Bay View said it "placed on hold" its purchase of the home equity lender because "federal banking regulatory agencies are considering new guidelines" that may limit insured financial institutions' holdings of home loans that are a high percentage of the property's value. "We are taking a close look at this," said William Fulwider, an OTS spokesman, speaking generally about such home equity loans. Earlier this month, Bay View said it would buy Carlsbad-based PSB Lending for $153 million in stock and cash, plus as much as $147 million for future profits. Loans for more than 100% of a home's value are increasingly popular, yet existing federal regulations only cover loans of up to 100%.
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