Sallie Mae, the dominant player in the student loan market, said it has acquired Pioneer Mortgage, a Novi, Mich., mortgage banker, signaling its expansion into the mortgage lending market. It is the second mortgage banking acquisition for Sallie, following December's deal for First Trust Financial, a mortgage bank with operations in Massachusetts, Rhode Island and New Hampshire. Under the deal, Pioneer, which provides mortgage lending in Michigan and Arizona, will operate as a wholly owned subsidiary of SLM Corp., the holding company for Sallie Mae, which now claims more than $80 billion in assets.
Sallie, originally created to facilitate a secondary market for guaranteed student loans, has extended into student loan originations under a 1998 reorganization and now accounts for half of the private-sector student loans originated in the U.S. It has also diversified into consumer lending.