Mortgage investors zeroing in on subprime lender

(Reuters) – A group of mortgage bond investors is reaching out for help in a novel bid to force H&R Block Inc’s defunct subprime lending unit to buy back billions of dollars in soured mortgages, the group’s lawyer said on Monday.

The plea to other bond investors may hasten the laborious task of gathering the numbers needed to demand accountability for faulty loans pooled into investments — mortgage-related securities that plummeted in value and helped trigger the worst financial crisis since the 1930s.

The investors, in a new tactic, are issuing a general call to others holding securities backed by loans originated by Option One Mortgage, a top 10 subprime lender during the housing boom, said Talcott Franklin, the Dallas-based lawyer spearheading the effort.

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