Another name has been added to the list of those interested in buying the largest mortgage company ever put up for sale.

BancBoston Mortgage started due diligence this week on Prudential Home Mortgage, according to industry sources. The Clayton, Mo.-based unit of the Prudential Insurance Company of America could bring as much as $1 billion.

Sources say the home lending unit of Bank of Boston is leading the due diligence for itself and two other parties, one of which is a venture capital firm.

A spokeswoman at Bank of Boston declined to comment.

BancBoston is no stranger to one particular part of Prudential. In February 1994, top executives from BancBoston Mortgage spent several days at Lomas Financial Corp.'s Dallas headquarters. A few months later, Prudential bought Lomas Information Systems, the division that serviced loans for third parties. The unit, at Prudential, is known as Residential Information Services.

At the time, Lomas officials said that BancBoston was considering signing on with the unit as a client. Presently, BancBoston is not a client of the Prudential loan servicing unit, but is a client of Prudential's property appraisal unit, Lender's Service Inc.

One Wall Street source said Prudential is pushing for a consortium of lenders to buy the information systems unit.

"Any lender with a lot of loans to service could look at this," the source said.

GE Capital Mortgage Corp., GMAC, and Norwest are still mentioned by industry insiders as the leading contenders for Pru.

Interested parties are being given one week to 10 days to do preliminary due diligence, according to sources with knowledge of the offering.

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