Freed from an exclusive contract with Intuit, Mortgage.com has moved quickly to license its technology to other multi lender web sites.
The Plantation, Fla., on-line home lender has reached a deal with LendingTree of Charlotte, N.C., that would give the lenders on LendingTree's site access to Mortgage.com's technology. Mortgage.com would split the fee income with LendingTree.
Mortgage.com cut the deal after Intuit, which owns 3.7 million shares, or about 9%, of Mortgage.com, announced a deal to buy Rock Financial Corp. of Bingham Farms, Mich. Like Mortgage.com, Rock is a mortgage banker focused on taking applications over the Internet.
Mortgage.com quickly canceled its contract to process loans exclusively for lenders that participate in Intuit's QuickenMortgage Web site. The contract had required that Mortgage.com share outsourcing revenues with Intuit and could not enter into similar agreements with other so-called aggregator sites, though it was free to offer its services to individual lenders.
"We're not going to do any more exclusive arrangements," said Seth Werner, chairman and president of Mortgage.com.
Intuit bought Rock so it could become a true mortgage bank that funds and closes loans in its own name, instead of simply being an electronic broker. Because Rock has its own Internet origination platform, Mortgage.com's services are now "somewhat redundant," said Mark Goines, senior vice president of Intuit's consumer finance division.
A separate agreement for Mortgage.com to process subprime loans brokered by QuickenMortgage remains intact, and Intuit has retained its stake.
Outsourcing is important for Mortgage.com because it is a revenue source other than making and selling loans.
Rising interest rates have hurt demand for loans to buy homes and have all but killed off the refinance market; most loans that come through the Internet are refinances.
Also this week, Mortgage.com made a deal that it hopes will bring in more purchase loans. It bought three small mortgage banking firms, Capital Savings Co., ACM/USA Inc., and PlanMax Financial, which market loans through homebuilders, real estate agents, and financial planners, respectively.