Residential Capital LLC, the home-lending arm of GMAC Financial Services, will announce that it is cutting its work force by about 25 percent today, the Wall Street Journal reported on Wednesday.

GMAC Financial, the General Motors (GM.N: Quote, Profile, Research) financing arm that was sold to a consortium of buyers including Cerberus Capital Management last November, is suffering from slowing loan demand and tightening credit in the lending unit, the paper said.

The unit, called ResCap, is expected to cut about 3,000 of its 12,000 employees in addition to the 1,000 that were to be cut by the end of this month, the paper said.

A spokesman for GMAC could not be reached for comment.