UPDATE 1-Visteon gets loan holder support for reorganization

* Says Wilmington Trust agrees to end plan litigation

* Visteon to provide term lenders default-rate interest

NEW YORK, July 28 (Reuters) - Visteon Corp VSTNQ.PK said its term loan steering committee had agreed to support the auto parts maker's plan of reorganization, helping the company along on its path to emerging from Chapter 11 bankruptcy.

Holders of a majority of the $1.5 billion term loan have agreed to vote in favor of the plan, the company said on Wednesday.

"The support Visteon has now received ... represents another positive step in Visteon's plan confirmation process," the company said in a statement.

Wilmington Trust Corp WL.N, the term loan agent, has also agreed to cease all litigation efforts it is undertaking in connection with confirmation of the plan, Visteon said.

In return for the support, Visteon will provide the term lenders with post-petition interest at the default rate and will help pay professional fees and expenses.

The company had proposed different terms if the lenders had voted to reject the plan. Visteon said it planned to reinstate the term loan and pay a lower, non-default rate of interest if the lenders voted against the reorganization.

Earlier this year, the lenders had teamed up with shareholders to propose their own financing plan for the company's reorganization. They argued their plan would have cut tens of millions of dollars in fees from Visteon's proposed plan, which the court eventually approved.

The move by the lenders could be another setback for shareholders. Shares of Visteon were down 15 percent at 46 cents in Wednesday afternoon pink sheet trading.

The stock has fallen from more than $2 a share earlier this year as shareholders have failed to get an equity committee recognized by the court and were unable to block the company's proposed funding plans.

A reorganized Visteon would emerge from bankruptcy under the control of holders of $870 million of unsecured notes, according to the company's proposal. The bondholders include Goldman, Sachs & Co (GS.N) and hedge funds such as Oak Hill Advisors and Silver Point Capital.

Visteon, a maker of electronics, lighting and interior parts for autos, is a major supplier for Ford Motor Co (F.N).

Johnson Controls Inc (JCI.N) has made an unsolicited $1.25 billion cash bid for most of Visteon's assets. Visteon has rejected the offer.

The case is In re Visteon Corp, U.S. Bankruptcy Court, District of Delaware, No. 09-11786. (Reporting by Chelsea Emery and Tom Hals in Wilmington, Delaware; Editing by Tim Dobbyn)