Folks in Walla Walla, Wash., didn't want to see the 70 jobs at the Meridian Mortgage servicing center on the list of casualties of the consolidation in mortgage banking.
So when Meridian Bank, which last year made a strategic decision to exit servicing, was unable to find a buyer for the center, officials from the Port of Walla Walla approached Meridian with a plan.
"We suggested the idea that Meridian might like to donate the center," said Jim Kuntz, manager at the Port of Walla Walla, a development authority charged with fomenting economic growth in the eastern Washington town.
Surprisingly, the bank was willing. "It sounds candy-coated, but its true," said Patricia R. Schanzlin, an executive vice president at Meridian Mortgage.
Meridian bought the facility from Old Stone Mortgage in 1991. In 1993, high rates of refinancings hit Meridian's loan servicing portfolio causing the company to seek to sell its $2.5 billion in rights. Meridian found a buyer - Bank of Boston - but that company had its own servicing platform in Jacksonville.
It looked grim for Walla Walla until the donation was suggested. From Meridian's perspective it made sense. There did not seem to be too many businesses in the area that would be willing to buy the 17,000-square-foot building. "Its a very, very remote area," said Ms. Schanzlin.
So Meridian choose the tax benefits of a donation over the uncertainty of a sale.
Now comes the hard part finding a buyer. The Port of Walla Walla has taken out advertisements in mortgage trade publications and has also mailed information to a slew of mortgage companies. On the positive side, the Port is willing to do more than its share. It is putting a new roof on the building and offering it for lease at a below-market rate $3,500 a month.
An interested company would get a servicing platform capable of handling 80,000 loans at a cost that is below the national average, according to Mr. Kuntz. "We have a great group of people here, with an average of 8 years of experience."
So far, there have been 10 responses to the advertisements. At this point, the Port has one lead with a major mortgage banking company that has expressed interest in the facility.
That company is set to visit the facility today, and may come to a decision in the next week. "Optimism is high here in Walla Walla;' said Mr. Kuntz.
