The Boston Globe reports from Massachusetts. "Potentially hundreds of Massachusetts home buyers and other mortgage borrowers are being left in the lurch after Mortgage Lenders Network USA Inc. of Connecticut reneged on funding loans it promised to make, banking and government officials said yesterday."

"'I am thinking hundreds' were affected, said Kevin Cuff, executive director of the Massachusetts Mortgage Bankers Association, estimating the toll on Massachusetts customers."

"In Massachusetts, the company made 1,140 mortgages worth nearly $240 million in 2005, state regulators said. Mortgage Lending Network's executive VP, James Pedrick, yesterday attributed the cessation of the wholesale business to 'turmoil' in the subprime market."

"The firm has been unable to resell some packaged, subprime loans on Wall Street, he said. This apparently interrupted the stream of financing necessary to make the next batch of loans, brokers said, though Pedrick would not elaborate. 'We didn't have the choice to fund those deals,' said Pedrick."

"Massachusetts brokers said some of their prime customers' loans were also affected. Donald Lambert, a Dartmouth broker, said eight of his customers' loans worth more than $2 million fell through, including some that apparently closed last week but were never funded."

''And a home purchase scheduled to close Friday fell apart, driving the buyer and seller into a legal dispute over the deposit. Customers 'are pretty upset,' he said. The affected loans were for his top-rated, not subprime, customers."

The Boston Herald. "Massachusetts banks have seen a 41 percent drop in home loan activity due to the recent slump in the local housing market, according to industry estimates. Kevin Cuff, executive director of the Massachusetts MBA, said the number of home-financing applications, both for mortgages and home refinancings, hit about 850,000 in 2004, the height of the recent housing boom."

"But that number could fall to about 500,000 in 2006, based on preliminary estimates, Cuff said. 'It’s cool out there - very cool,' said Cuff of the housing market."

"Local bankers say they’ve seen the big dropoff. 'It’s pretty quiet,' said David Falwell, chief lending officer at Middlesex Savings Bank in Natick."

"Richard Holbrook, the new chief executive at Boston’s Eastern Bank, said fixed-rate mortgages originated at his bank hit about $800 million in 2005 and fell to about $500 million in 2006."

"It’s the same outfit that criticized talk of a 'housing bubble' back when people were talking seriously about million-dollar “fixer-uppers” in toney towns like Newton."

"Now the Massachusetts Association of Realtors has another news bulletin for you: The housing 'correction' may soon be over. That was fast."

"With serious buyers scarce, that observation may be at odds with what many would-be home sellers are experiencing in the current market. And it is also at odds with an even more telling measure: the Realtors’ own statistics."

"'November figures, and the word on the street from our Realtor members, indicate that the correction may be nearing an end,' David Wluka, the group’s outgoing president, stated in a press release last week."

"Nor is it the first time that MAR predicted the struggling home sales market had turned a corner. In fact, it was a prediction made just a month before, in late November. A 2 percent drop in the median home price, and a 16 percent slide in sales, prompted this declaration. 'It appears that the market correction may be about over,' Wluka declared then."

"To support its latest turnaround prediction, MAR used a month-to-month sales comparison, noting sales dropped by a mere .3 percent from this October to November. Yet for years, especially when the market began to lose steam, the spokesman for the Realtors group argued against such month-to-month comparisons."

"Wluka, whose term as MAR president just expired, defended the recent use of month-to-month comparisons for what he called 'trending.' 'I am very careful about not spinning because you lose all credibility,' he said. OK, maybe spinning is the wrong word. Cheerleading is probably more accurate."