Wachovia Corp. is waiving fees for paying off "Pick-A-Pay" mortgages early, according to a story in the Wall Street Journal.

Pick-A-Pay lets borrowers choose between four monthly payments, including one that doesn't even cover the full interest amount, meaning the loan balance would rise. Prepayment fees make it harder for borrowers to refinance out of such loans, which have been blamed for increased delinquencies and foreclosures.

Earlier this month, Washington Mutual Inc., the nation's largest thrift, announced it would no longer issue loans where monthly payments don't cover interest.

In April, Wachovia reported a $350 million first-quarter net loss, due in large part to big losses within its $120 billion of Pick-A-Pay loans, a legacy of Wachovia's ill-conceived 2006 purchase of Golden West Financial Corp., the Journal said. Almost 60 percent of Wachovia's Pick-a-Pay mortgages are in the now-tanking California housing market, the Journal said.