H&R Block Inc. said its Option One Mortgage Corp. had increased a credit line by 7%, to $800 million, and that CIT Group Inc. had joined the syndicate of lenders providing the line.
The line is used to fund the advances of principal and interest that Option One makes as a servicer to investors in mortgage-backed securities. Servicers often make such advances when homeowners' payments are late.
Wells Fargo & Co. and Royal Bank of Scotland Group PLC's Greenwich Capital Financial Products were already in the syndicate.
The line and the syndicate were expanded on Dec. 24. H&R Block disclosed the changes in a Securities and Exchange Commission filing Monday.
In the same filing, the Kansas City, Mo., company said that Mark Ernst, who resigned as chairman and chief executive in November, would get a severance package including $2.5 million in cash and full vesting of 762,925 stock options.
Last year, H&R Block agreed to sell Option One to Cerberus Capital Management LP, but the deal fell apart. Richard Breeden, a dissident shareholder who criticized the tax-preparation company's forays into financial services, was elected to the board and later succeeded Mr. Ernst as chairman.
Last month, H&R Block shuttered Option One's origination business; Lazard LLC is shopping around the unit's servicing platform.
