March 7 (Bloomberg) -- Fremont General Corp. told workers the California-based lender is talking with as many as six suitors interested in buying its residential mortgage business.

Final presentations to investors may be made today, said Robert Clafford, senior vice president of residential real estate at Fremont Investment & Loan, during a conference call with employees. Clafford wasn't specific about what a sale may include and said workers will remain on paid leave during the talks.

``The response to the inquiries has been very positive,'' Clafford said. ``There's five or six interested parties and we're working through each one of these.''

Fremont said last week it was getting out of the subprime mortgage business, and agreed to halt at least 14 practices that violated federal rules. The lender sent most of its residential lending staff home earlier this week to await word on the fate of their jobs and their company, which specialized in loans to people with poor credit ratings and heavy debts.

``Because we continue in discussions with these companies, you will all continue to be on paid leave,'' he said. ``That's going pretty well. Do I know what's going to happen with that? I don't at this point.''

Late payments and defaults on U.S. subprime loans are at a seven-year high. More than two dozen mortgage lenders have gone bankrupt, closed operations or sought buyers since the start of 2006, according to data compiled by Bloomberg.

Shares Gain

Shares of Santa Monica-based Fremont soared $1.75, or 26 percent, to $8.53 at 4:21 p.m. in New York Stock Exchange composite trading. That's about half of what they fetched at the start of this year.

Fremont's management had three conference calls yesterday over the sale and has ``two or three more meetings'' today, Clafford said.

``People are calling, `Bob, should I go find a job, what should I do?''' he said. ``You need to do what's best for you. I wouldn't want you sitting there thinking, you know, that everything is 100 percent perfect. It's not.''

``We're doing everything we can from the company here to expedite a sale of this business.''

Earlier this week, Citadel Investment Group LLC agreed to buy bankrupt ResMae Mortgage Corp. and its portfolio of loans for about $180 million, topping Credit Suisse Group.

To contact the reporter on this story: Bradley Keoun in New York at bkeoun@bloomberg.net

Last Updated: March 7, 2007 16:49 EST