width=306WASHINGTON - GMAC Financial Services is expected to get about $3.5 billion in additional U.S. government aid to help the troubled lender absorb mortgage losses, a financial industry source familiar with the matter said on Wednesday.

The announcement is expected within days, the source said, speaking anonymously because the talks have been private.

GMAC has already received $12.5 billion in aid from the U.S. government since December 2008.

News of the potential capital infusion lowered the cost of protecting GMAC's debt against default in the credit derivatives market.

The additional capital will support GMAC's mortgage assets, which many analysts see as the finance company's main obstacle to reaching profitability.

GMAC has about $57 billion of total mortgage assets, or about a third of the company's overall balance sheet. GMAC's auto finance operations were profitable in the third quarter, earning about $164 million after taxes, while the mortgage business lost nearly $600 million.

GMAC has been speaking to Treasury about its capital needs for months, after a government stress test found that the former financing unit of General Motors needed about $11.5 billion. The company has been unable to raise private capital.

Treasury spokesman Andrew Williams said: As we stated on November 9, Treasury is in discussions with GMAC to ensure its capital needs as determined last May by the Stress Tests are met.

In November, GMAC Chief Executive Al de Molina resigned and was replaced by Michael Carpenter, a board member and former Citigroup executive.

GMAC had spoken to the government about capital needs for months, although it said in November that it asked the Treasury to postpone decisions about putting more capital into GMAC until Carpenter and other managers had assessed the company's condition.

The cost to insure GMAC's debt against default in the credit derivatives market fell to around 4.4 percentage points, or $440,000 a year for five years, from 4.66 percentage points at Tuesday's close, according to market data company Markit.

(Reporting by Karey Wutkowski, Additional reporting by Tim Ahmann in Washington, and Dan Wilchins and Karen Brettell in New York; Editing by Derek Caney, Dave Zimmerman)