The regulator for Fannie Mae (FNM) and Freddie Mac (FRE) said Friday that stemming the foreclosure crisis would require resolving millions of troubled mortgages tied to securities that weren't issued by the two mortgage giants.

So-called private-label securities, or PLS, are backed by 15% of outstanding U.S. mortgages, but represent roughly half of all serious mortgage delinquencies, Federal Housing Agency Director James B. Lockhart said in a speech here.

"If we are going to stabilize the housing market, we have to address that PLS 50%," he said.

There are signs the foreclosure problem is deepening. The number of homes lost to bank repossessions spiked in February despite halts on foreclosures announced by the three largest U.S. mortgage servicers. About 74,000 homes were lost to foreclosure during February, up from 67,000 in January, according to RealtyTrac.

Lockhart suggested that Fannie and Freddie could help cure the problem by setting an example of aggressively modifying troubled loans. Last year, the mortgage giants launched a program for streamlined modifications of the loans they own or guarantee. The Obama administration launched a separate program this month to pay mortgage servicers financial incentives to modify loans.

Lockhart reiterated that he has been urging Treasury to provide financial assistance to private mortgage servicers. The housing bust has crippled the companies, which in turn has hampered Fannie's and Freddie's ability to meet low- to moderate-income borrowers, he said.

Fannie and Freddie are forbidden by their government charter to buy or guarantee loans with a loan-to-value ratio higher than 80% unless the loan is partially insured or has another form of credit enhancement. Such high loan-to-value mortgages often benefit poorer borrowers.

Partly as a result of the mortgage insurers' woes, Fannie and Freddie will likely fail all of their affordable housing goals for 2008, Lockhart said. FHFA must overhaul the companies' affordable housing goals by 2010.

Lockhart said he plans to release 2009 goals for the companies soon, which will be tougher than the 2008 guidelines.

-By Jessica Holzer, Dow Jones Newswires; 202-862-9228; jessica.holzer@dowjones.com