The US government is planning to sue some of the country’s largest banks over mortgage-backed securities they sold that lost value in the housing market collapse, according to reports.

The US government is going to sue about 12 big banks for misrepresenting the quality of mortgage securities, according to a report in the New York Times.

US house prices fell by a record annual amount in the final three months of last year, two housing indexes showed today.

US mortgage finance company Freddie Mac said today it would need an additional €23.1-26.2bn in government aid as it coped with losses on loans the company backed during the housing crisis.

The US federal takeover of troubled US mortgage giants Fannie Mae and Freddie Mac could have been prevented if Congress had acted on its recommendations, the White House said today.

US president George Bush said the historic federal government takeover of mortgage giants Fannie Mae and Freddie Mac was needed to keep them from failing, a risk he called “unacceptable” for an economy battered by housing and credit crises.

President George W Bush tonight said that the historic federal government takeover of mortgage giants Fannie Mae and Freddie Mac is needed to keep them from failing, a risk he called “unacceptable” for an economy battered by housing and credit crises.