UNB Corp., a small bank and insurance holding company here, has formed a subprime mortgage unit.

United Banc Financial Services will provide financing for customers who do not qualify for bank loans.

"United Banc Financial Services has mortgage loan options for almost every borrower, including people who typically might have difficulty finding a loan," said Scott E. Dodds, executive vice president in charge of the company's mortgage group.

"Traditional loan requirements sometimes work against people who are self-employed, have income that can't be verified, or have credit problems. Our new financial services affiliate can probably help those people get financing for the purchase of their home."

Large banks have been forming marketing alliances and buying up subprime companies to offer loans to customers who do not qualify for traditional loans. But United Banc is one of very few smaller banking companies that have jumped into subprime lending.

United Banc Financial Services will market loans through bank branches and via direct mail.

A United Banc veteran will run the unit, Jeffrey McHenry will be lending manager, and new hires Timothy S. O'Brien and Greg Stearn Jr. will originate loans.

UNB Corp. is the parent company of United National Bank and Trust Co., United Banc Financial Services Inc., and United Insurance Agency Inc.

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