Several of California's largest thrifts are jumping into the arena of home equity lending.

Home Savings of America and California Federal Bank are among the thrifts that have recently turned to second mortgages as a filler for scarce home-loan refinancings and as a way to diversify their offerings.

"It is generally reflective of the stress to get loans," said Ed Furash of Furash & Co., a Washington, D.C., consultant.

Home's move is substantial. The Irwindale-based subsidiary of H.F. Ahmanson & Co. is in the process of rolling out a nationwide home equity line-of-credit program, said a company official.

The program will add auto loans July 15. It is now originating only home equity loans, which generally have fixed rates and a limited borrowing span.

The bank has hired 14 employees to start up the consumer financing unit. Many of the new employees had worked at Household Finance.

"We estimate that in five years we will be a major consumer finance lender in the country," said Scott A. Norris, a Home Savings vice president. "God knows, we have the financial wherewithal."

Coast Federal Bank, Los Angeles; American Savings Bank, Irvine; and Glendale Federal Bank, Glendale, are also getting into home equity lending.

California Federal, Los Angeles, has employed MBNA America Bank, a subsidiary of MBNA Corp. to handle its return to home equity lending. The Newark, Del., unit buys and services the second mortgages California Federal originates.

MBNA allows California Federal to offer a full slate of home equity loans, including a second mortgage permitting homeowners to borrow against 100% of their homes' equity, said Jeffrey A. Rigsby, a CalFed executive vice president.

"It is not some passive offering to meet the random demand of the customer," he said.

Rather, California Federal has placed home equity lending high on its priority list. He said the bank may even start doing home equity lending on its own.

Both banks have the capability to make loans to borrowers with marred credit. Mr. Rigsby said that ability is becoming more important as borrowers with stellar credit standings become more rare.

A spokesman said consumer lending will now make up a third of Glendale Federal's lending activity. The spokesman said that Glendale is going headfirst into consumer lending because the profits are there, not in first mortgage lending.

The bank has long offered home equity loans with set durations, but it soon will offer home equity lines of credit. It recently introduced lines of credit not secured by property.

The spokesman also expects that Glendale will soon begin offering auto loans.

Mr. Furash, the consultant, said the California thrifts are among the last to get into home equity lending. He said the trend for thrifts to take on second-mortgage lending has been raging for two years.

"It is prudent to make these loans again," he said.

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