Fremont General Corp. said Monday that it would sell its residential real estate business and about $2.9 billion in subprime residential mortgages.

The Santa Monica-based lender expects to lose more than $100 million from the sale, and said in a statement that it sold the loans to an undisclosed buyer “at a discount that reflects the current conditions in the subprime mortgage market.”

The mortgages involved in today’s agreement are separate from the $4 billion worth of subprime loans that Fremont earlier this year agreed to sell. Those will result in a $140 million pretax loss.

The company also postponed its annual shareholders meeting, which had been scheduled for May 17. The company is currently searching for an auditing firm. Its previous auditor, Grant Thornton LLP, resigned suddenly, citing resistance from Fremont in providing information for an expanded audit.

Fremont said that it will continue to lend money through its profitable commercial mortgage lending arm and will also continue to operate its more than 20 retail banking branches in the state.

Shares in Fremont surged $1.73, or 25 percent, to $8.78 in afternoon trading Monday on the New York Stock Exchange.