Fifteen months ago, First Finance struck out in Detroit. The subprime lender found that competition was just too stiff.

But now the Bloomfield Hills, Mich.-based company is back with a vengeance. In fact, it's hell-bent on capturing 35% of the home equity market there-in the next two months.

First Finance's heavy hitter is a loan with no closing costs. The company is absorbing the cost of title insurance, appraisal, closing fees, recording fees, and origination fees for homeowners looking to refinance their homes.

So far it seems to have hit gold. Since it started promoting the new offer on television in mid-January, it has been taking $5 million to $6 million in applications weekly, said Mark Stablile, vice president of originations. About 80% are being closed.

"A lot of our competitors have no idea how we can do this," said Mr. Stablile. The secret, he said, is low overhead, high volume, and favorable pricing from the companies that buy First Finance's paper.

First Finance uses a "mortgage by mail" package that a potential borrower completes at home and mails in. The final steps of a closing are done over the phone.

Although First Finance's brokers are earning smaller commissions on loans they take from Detroit because of the special promotion, they are still benefiting, Mr. Stabile added. "You have to close 10 loans a month as a broker to get your commission anyway-and these aren't a tough sell."

The no-money-up-front loan allows First Finance to reach borrowers that it ordinarily couldn't, Mr. Stabile said. Rather than spending thousands on these costs, potential borrowers can use the money to pay off other debts.

First Finance is closing loans in Detroit that average $65,000, with debt-to-income ratios of 75% to 80%. First Finance specializes in "cash-out refinances," which allow homeowners with blemished credit records to roll over their first mortgage at a lower interest rate and receive cash up front to pay off bills.

The company expects to take its Detroit sales tactics and go national, Mr. Stabile said. "The way this industry is now, there is more demand out there than supply," he said. "We're just evening that up in Detroit."

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