HanoverTrade.com, a new player in online mortgage loan trading, has completed its first trade of a whole loan pool.

Thornburg Mortgage Inc. of Santa Fe, N.M., a mortgage real estate investment trust with $4.5 billion of assets, bought loans from Firstar Mortgage Corp. of Bloomington, Minn. Details of the transaction, which was made two weeks ago, were not disclosed.

David Akre, a vice president at Thornburg, gave HanoverTrade.com good reviews after the deal, and Cheikh Faye, vice president of Firstar Mortgage, described the site as a "very useful tool. One can navigate with ease and execute transactions in very little time."

HanoverTrade.com, a unit of the New York real estate investment trust Hanover Capital Mortgage Holdings Inc., was launched in late October at the annual Mortgage Bankers Association convention in San Francisco.

Irma Tavares, president of HanoverTrade.com, said the company was created to foster an online trading market for the existing clients of its sister company, Hanover Capital Partners, which has brokered and done diligence on trades of loan pools in the secondary mortgage market for 11 years.

With its inaugural transaction, the site quietly entered a nascent sector of the mortgage business in which several companies are pushing to create online loan-trading hubs. Competitors include the Dulles, Va.-based UltraPrise and the Washington, D.C.-based Pedestal, which also run Web marketplaces for whole loans.

Yet none of these sites has hit the ground running, said Richard Beidl, a senior analyst at the Needham, Mass.-based TowerGroup.

Mr. Beidl said that the firms focusing their efforts on closed loans have overestimated the potential size and profitability of that market. Also, he said, the Web exchanges' efforts to make the loan trading more efficient introduce radical changes to the process, which have alienated many traders.

Despite these obstacles, he said, "there is no question that these types of platforms will continue to be important because they automate what is a highly inefficient and costly process."

Ms. Tavares emphasized that HanoverTrade.com's effort is to streamline the traditional trading process. The company, she said, has created nine standardized trading protocols, or auction styles, for the site. When a seller lists a pool of loans on the site it can choose to auction it as an all-or-nothing sale, accept partial bids, set a defined bid date, or set up a "jump ball" situation in which the first bidder to offer an acceptable price wins the deal, among other options.

HanoverTrade.com also requires the seller to choose one of 60 standardized purchase and sale agreements - legal documents that set the terms of a sale and are listed on the site.

Before bidding on a loan pool, a buyer must agree to the contract that the seller identifies. Ms. Tavares said that the standardized agreements reduce by weeks the time it takes to negotiate and settle a trade.

HanoverTrade.com hosts only trades for loan pools, not individual loans. Currently $420 million of loans are listed for sale on the Web site, including eight pools put up by the Small Business Administration, a client of Hanover Capital Partners, as part of a larger sale of 46 loan pools worth $1.1 billion.

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