Mixstar Inc., a company that provides information to mortgage lenders over the Internet, is for sale.
Kirk Hoiberg, Mixstar's president, said the company has retained Hamilton Carter Smith & Co., a Beverly Hills mortgage investment banking firm and servicing broker, as its adviser.
Mixstar was formed in 1994 by Walter Blass, a former chief executive officer of Shearson Lehman Mortgage. Mixstar's service, which lets lenders and brokers transmit details of loan offerings over the Internet, is available on America Online and the World Wide Web.
Industry observers said technology companies with a foothold in the mortgage business such as Electronic Data Systems and Alltel are potential buyers. This year, Alltel's mortgage division agreed to offer its loan data on-line through Mixstar.
One investment banker said there also may be interest from companies seeking entree into the mortgage business, such as Microsoft. An acquisition of Mixstar would make more sense than creating a new mortgage service because Mr. Blass is an experienced mortgage banker and knows more about borrowers, sources said.
Herman Churchwell, chief executive officer of Hamilton Carter Smith, said Mixstar's books will be available within the next few weeks and that various financial services and technology companies have expressed interest.
The Mixstar service has about 2,000 subscribers. Mr. Hoiberg said most are brokers. Subscribers get pricing updates on mortgage-backed securities, as well as industry news and commentary.
But Mixstar is to unveil a consumer-oriented feature next week. The service, called Mixstar Home Loan Center, will be available free to consumers. Borrowers can use it to review mortgage products from about 20 lenders, including Countrywide Credit Industries and BankAmerica.
Sources said Mixstar is just now breaking even and would benefit from having a deep-pocketed parent. Mr. Hoiberg said that Mixstar hopes to be to mortgage lending what Amazon.com, a successful on-line book retailer, is to the publishing industry. He added that the company wants to spend heavily on marketing to establish its brand name.
New technology for mortgage lenders is being developed at a breakneck pace as lenders continue to seek outlets for originating and buying loans.
Last month, Intuit Inc. announced its first foray into the mortgage business, a Web site for Quicken Mortgage with five of the nation's largest lenders.
And a technology start-up in San Ramon, Calif., IMX Mortgage Exchange, plans soon to offer software to mortgage bankers and brokers that can be used to set up an electronic trading system for mortgage loans.
