N.Y. On-Line Lender to Pay $7M for Chicago Company
NEW YORK-American Home Mortgage Holdings Inc., said it has agreed to acquire First Home Mortgage Corp. of Chicago in a deal worth more than $7 million.American Home originates mortgages through its Web site, MortgageSelect.com, and other sites, including Microsoft's Home Advisor, E-Loan, and Consumer Financial Network.
The New York company said Tuesday that it would pay about 490,000 shares of its common stock and $3.6 million in cash for privately held First Home.
Michael Strauss, American Home's chairman, president and chief executive officer, said the agreement will end a buying spree that the company initiated to build its presence in the three largest markets in the country: New York, Chicago, and Los Angeles.
Just three weeks ago American Home acquired Marina Mortgage Co. of Irvine, Calif., in a deal worth about $7.3 million.
Mr. Strauss said that American Home is seeking to become one of the largest on-line mortgage companies, and that its Internet partners will benefit from an increased mortgage origination capability and more service call centers.
American Home's stock surged almost $1 on Tuesday after the announcement, closing at an all-time high of $7.25. It was trading at $7.375 at noon Wednesday.
Calif. Lender Offers Bonuses To Builders for Sales Leads
RICHMOND, Calif. - Loanz.com, an on-line mortgage originator, said it would pay home builders to provide leads.Builders need not endorse Loanz.com's products to their clients. After registering, they will be paid $50 for each lead, regardless of whether it results in a closed loan.
Freddie to Make Web Service Available for Retail Lending
WASHINGTON - Freddie Mac on Tuesday announced that its Internet-based automated underwriting service will be available to lenders for their retail operations in the second half.The system, called Loan Prospector, has been available for wholesale lending since July. A spokesman said ease of access has helped make it "a huge success."
Freddie has had an proprietary on-line retail system, called GoldWorks, in operation since 1995, but it is not Internet-based. Loan Prospector will enable retail lenders to make decisions at the point of sale.
But the service and a similar one from Fannie Mae have drawn inquires from the Department of Housing and Urban Development. In Dec. 21 letters HUD asked the government-sponsored enterprises for information to show that the Internet services do not constitute new mortgage programs, which would require HUD approval.
A Freddie Mac spokeswoman said her company is pulling that information together to provide to HUD, but she added: "We are certain we can easily demonstrate [this] is not a new product."
HUD has also expressed fair-lending concerns about both companies' automated underwriting systems. In letters last February, HUD asked for information on that issue, but the companies have withheld some, citing confidentiality questions.
Calif. Agent Referral Service Secures $53M of Financing
EMERYVILLE, Calif. - HomeGain, an e-commerce company that caters to home sellers, said it had secured $53 million of financing from a high-profile investor group that includes Marc Andreessen, co-founder of Netscape and former chief technology officer at America Online.The group also includes J.&W. Seligman and Co.; Grett Bullington, the executive vice president of Excite@Home; BancBoston Ventures; Technology Crossover Ventures; TMCT Ventures; Comdisco Ventures; and Mindful Partners.
This is the third round of venture capital financing for HomeGain. The money will be invested in technology and marketing.
HomeGain enables homebuyers and sellers to select real estate agents on-line by anonymously reviewing proposals from local agents.
