GE Capital Mortgage Services has grown explosively since its founding six years ago, but now the company is taking a breather to digest its $106 billion portfolio, fifth-largest in the country.

The wholesale mortgage operator grew to $109.5 billion by December 1995 after GE Capital Mortgage Corp. got into the servicing business by acquiring Travelers Mortgage Services, with its 13.2 billion portfolio, in 1990. Subsequently, GE snapped up $64.7 billion Shearson Lehman Hutton Mortgage Corp. and the first mortgage portfolios of Wachovia Corp. and Birmingham-based Amsouth Corp.

But that kind of swift expansion is on hold. Since peaking at $109.5 billion, the portfolio has declined by $3.5 billion as of June 30, which a company spokesman said was intentional.

Although the company would not disclose its strategy, an industry source with close ties to GE Mortgage said management feels it is time to pause.

"They are focused on what they have to do to make it better," the source said."

In other words, GE Mortgage is out to improve managing its portfolio. The groundwork started quietly about two years ago when the company sought to purchase software to access its accounts, which now total 1.2 million.

But the company was unable to find a program that could hold more than 250,000 loans, meaning that a customer service representative might have had to run as many as five programs to find a file.

So under supervision of Richard Nastasi, senior vice president of information and technology, GE developed its own software that accommodates all 1.2 million loans.

"This enables us to respond with greater speed to our customers," Mr. Nastasi said. The program can be upgraded to handle up to 6 million files, he said.

Customer service representatives can easily identify every aspect of a loan. Representatives at service centers in St. Louis, Houston, and San Bernardino, Calif., are encouraged to cover, on average, three items each time they speak with a customer.

Mr. Nastasi said sometimes customers call to find out whether their payments have been received. The representative advises on receipt and then might remind a customer of upcoming events, such as loan-rate adjustments or an insurance premium deadline.

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