WASHINGTON (Reuters) – The U.S. Department of Housing and Urban Development will loosen terms of its foreclosure-prevention effort so that the program, meant to backstop $300 billion in home loans, can be more effective, the agency said on Wednesday. The Hope for Homeowners program will now insure home loans that have had as little as 3.5 percent of their value erased by the original lender. Under the original terms, a lender would have to write off 10 percent of a failing loan before the government would invest. Investors who hold a stake in failing loans through second liens may receive...