Freddie Mac and Wells Fargo Settle on Loans Wells Fargo said on Monday that it would pay $780 million in cash to Freddie Mac to resolve substantially all repurchase liabilities on home loans sold to Freddie before 2009. The settlement was reached Friday and totaled $869 million before adjusting for credits related to previous loan repurchases. Wells Fargo announced the settlement five days after Citigroup agreed to pay Freddie, the government-controlled mortgage company, $395 million to settle similar claims over about 3.7 million mortgages sold from 2000 to 2012. Citigroup is the third-largest American bank by assets. Wells Fargo, the fourth-largest American bank by assets, said the cost of its agreement was covered by reserves. On Aug. 7, Wells Fargo estimated a probable $2.2 billion loss over claims that it had breached representations and warranties in the sale of mortgage loans. It was unclear how much of the latest settlement related to Wachovia, which Wells Fargo bought at the end of 2008. Freddie Mac and its larger rival Fannie Mae, which both received federal bailouts in 2008, have pushed banks to buy back mortgages that soured during the nation's housing downturn. Banks can be required to buy back loans if the representations and warranties over how well the loans were underwritten, and whether borrowers could afford them, prove false. Freddie did not respond to a request for comment. Wells Fargo declined to comment, citing a "quiet period" before its Oct. 11 release of third-quarter results.