CARMEL MOUNTAIN RANCH - Accredited Home Lenders Holding Co. said Wednesday that it will close most of its mortgage-lending operations and lay off 1,600 employees.

They will join more than 40,000 mortgage-lending employees who have lost their jobs this year, according to company announcements and a major outplacement firm.

Accredited said it would cut 180 jobs from its Carmel Mountain Ranch headquarters, which had 400 employees at the end of June.

Wednesday morning, the parking lot appeared to be more than half-full at Accredited's three-building headquarters on Avenue of Science. A reporter attempted to interview several Accredited employees there, but all declined. A call to Accredited for comment was not returned.

Accredited makes loans to home buyers with subprime, or shaky, credit. The subprime market began to collapse earlier this year as borrowers defaulted on loans. Subprime lending companies such as Accredited scrambled to stay afloat - and some closed or declared bankruptcy.

At least 40,000 workers have lost their jobs at mortgage lending institutions since the start of the year, according to recent company layoff announcements and data compiled by global outplacement firm Challenger, Gray & Christmas Inc. Meanwhile, construction companies have announced nearly 20,000 job cuts nationwide this year. The National Association of Realtors said it expects membership to decline this year for the first time in a decade.

More layoffs are announced daily. On Wednesday, Lehman Brothers Holdings Inc. closed its subprime mortgage business, laying off 1,200 workers at 23 offices, Scottsdale, Ariz.-based 1st National Bank Holding Co. closed its wholesale mortgage unit and cut 541 jobs. On Tuesday night, banking giant HSBC said that it would close a main financing office and cut 600 jobs.

The job losses threaten to rival the massive airline industry layoffs following the Sept. 11 terrorist attacks, in which about 100,000 people lost jobs. Some economists say this harsh turnaround could spread from the real estate sector to the entire economy, possibly bringing on a recession.

Accredited is closing its retail mortgage division, which makes loans directly to customers. It is also closing five of its 10 wholesale lending divisions that make loans through brokers.

Accredited and other subprime lenders do not keep most of the loans they make. They bundle the loans and sell them to investors. The subprime lender then has more money to make even more loans. However, the investors have the right to return the loans and get their money back if the loans become delinquent. These repayment demands can cripple or bankrupt a lender.

Defaults and delinquencies have been "increasing substantially" among loans made in 2006, Accredited stated in its annual report, filed Aug. 2.

Accredited bought back $90 million in loans in the quarter ended Dec. 31, compared with about $62 million in the quarter ended Sept. 30. In the first five months of this year, Accredited repurchased $152 million in loans and paid $39.2 million to eliminate the repurchase requirements for other loans, the company stated.

Mortgage companies such as Accredited appear to be going into "hibernation" mode while the crisis lasts, said RBC Capital Markets analyst Jason Arnold.

"Anyone who goes into this kind of protection mode, if they can make it through the challenges, they will probably emerge on the backside in a much better competitive environment," Arnold said.

In June, Accredited announced that it had agreed to a takeover by a Dallas-based private equity firm, Lone Star Fund V. But Lone Star has balked at carrying through the purchase, which valued Accredited at $15.10 per share, or $400 million.

Lone Star has said that Accredited's financial condition has so drastically deteriorated that the original conditions of the purchase agreement are no longer valid. Accredited disagreed, and invoked a provision of the agreement that required Lone Star to extend the offer for Accredited stock. That offer expires Tuesday. A call to Lone Star for comment was not returned.

Shares of Accredited fell Wednesday by 45 cents to close at $6.10.

The Associated Press contributed to this story. Contact staff writer Bradley J. Fikes at (760) 739-6641 or bfikes@nctimes.com. Comment at nctimes.com.