Wachovia sells off land loans

Wachovia Corp. is selling $40 million in land and construction loans to a venture led by residential land company LandCap Partners, the Wall Street Journal reported today.

The loans are to home developers backed by 2,900 house lots in such states as California, Arizona, Florida and Illinois, the Journal reported. Many of the loans are in some state of distress as borrowers fall behind on payments and land values fall.

The Charlotte bank last month said it was considering the sale of non-core assets but gave no details. The sale amounts to a small percentage of Wachovia's $24 billion in construction and land loans. Souring construction loans are a problem for banks industrywide.

A Wachovia spokeswoman could not be immediately reached.