To help small and midsize lenders keep up with quickly advancing technology, Residential Funding Corp., Minneapolis, an indirect subsidiary of GMAC, has developed software to handle all facets of their business, from originations to pipeline management.

The program, called DirectWise, is unusual, said Bruce Paradis, president, because it can be used to sell loans to any investor, not just to Residential Finance.

Mr. Paradis said the program could also be useful for banks that are new to the mortgage business, whether through the purchase of a mortgage bank or the expansion of an existing small subsidiary.

"This is a way for them to get into the business without a lot of front- end investment," Mr. Paradis said. "We are selling this on a per-loan basis, rather than a fully loaded front-end price."

The goal of the project, Mr. Paradis said, was to help smaller lenders keep up with technology to keep down their costs.

"As a conduit we just bought loans before and used our expertise to further that business," he said. "Now we thought we should bring more tools" to the small and midsize lenders from which they buy loans, he said.

The system can be loaded with other investors' criteria, Mr. Paradis said. "If it helps us buy some loans, wonderful. But we are thinking of this as a business in and of itself," he said.

The software is an expanded and modified version of an existing program that the company tailored to help lenders from the point of sale to the closing and delivery of loans.

"It is our belief that current systems will develop rapidly as Freddie and other value-added networks come on-line," Mr. Paradis said. "We expect that these processing systems, DirectWise included, will need updating and improvement. If we can stay abreast of changes in the market, it can benefit a number of clients."

As the company offers new products, like home equity and nonconforming credit loans, they will be added to the system for access by lenders, he said.

Mr. Paradis said that there have been a few contracts to buy the software after a pilot program since its introduction last month.

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