Remax International, a large franchise network of real estate brokerage offices, is in the midst of testing a computerized loan origination system, or CLO.

Considering Remax's stature in the real estate brokerage industry - it has 2,400 franchised outlets - its adoption of the system would give a major seal of approval to CLOs in general and the Mars system from GHR Systems Inc. in particular.

But a Remax official, Daryl L. Jesperson, executive vice president, said it was unlikely the company would adopt the product - yet. He said today's regulatory environment is too muddy. Remax expects to delay a decision until the Department of Housing and Urban Development adopts clear-cut rules governing CLOs.

"We are in limbo," Mr. Jesperson said. "I can't say that we are not (going to adopt the CLO); I can't say that we are."

At issue are HUD's regulations regarding CLOs. HUD requires that CLO users meet the government agency's requirements as mortgagees. That includes maintaining a net worth of $50,000 - too high for most real estate brokers, even those within the Remax system.

HUD's requirement has the effect of forcing FHA loan originations off CLOs.

It is important to Remax officials that its franchises originate FHA loans freely on any system.

HUD now is considering comments on CLO regulations. There is no timetable for announcing final rules.

Until that happens, Mr. Jesperson said, Remax would stay away from CLOs.

Real estate brokers say that market pressures are forcing them to think more seriously about getting into CLOs or controlled business arrangements, a legal way they can earn referral fees.

"This poor real estate market is accelerating that," said George Eastment, an executive vice president at Fairfax, Va.-based Long & Foster Real Estate Inc., a home brokerage company that originates loans with Norwest Mortgage Co. "An awful lot of realtors are hurting, and they need to find other ways to make some money."

Home lending is one such way, he said.

Indeed, some Remax branches have created controlled business arrangements with lenders, Mr. Jesperson said.

The Mars network from GHR Systems Inc., Wayne, Pa., has garnered much attention in the lending industry. It appears to be the most successful CLO, at this early stage. It has trained about 1,000 people to operate its systems nationwide.

Mr. Jesperson said the system itself is not the issue. "We are very positive on it," he said. Mars is "a heck of an idea" and "a fantastic piece of software," he added.

He said consumers like the system because it allows them to shop for a loan with the many lenders that display their products on the computer screen. "We know it works," he said.

But Scott M. Cooley, president and chief executive of Contour Software Inc., Campbell, Calif., and a close follower of lending technology, said real estate agents are losing interest in CLOs. They think the systems "are not worth the hassle," he said.

They require training and an understanding of lending, and they take energy away from selling real estate. "It is just not worth the $100 to $200 on a deal," he said.

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