Tree.com Inc. said Friday its net loss narrowed 67% from a year earlier to $7.4 million in the third quarter, though the results were worse than in the second quarter, when the company made about $700,000.

The Charlotte mortgage bank and lead generator, which runs the LendingTree.com Web site, said it had expected to break even on the basis of adjusted earnings before interest, taxes, depreciation and amortization. But a $4.2 million increase in the provision for loan losses and $1 million of unexpected legal costs drove adjusted EBITDA to negative-$3.5 million.

The additional legal costs were mostly associated with a suit against Mortech Inc., a Lincoln, Neb., company that provides lenders with software to price offers to customers through LendingTree. Tree.com had accused Mortech of violating an agreement not to work with its competitors by helping Google Inc. with a new mortgage-lead venture. The case was settled last month.

Revenue at Tree.com's lending operation — its largest segment by that measure — increased 21% from a year earlier, but fell 34% from the previous quarter to $24.1 million. The company said the decrease was primarily driven by higher interest rates, which led to a 31% drop in loan production, to $620.2 million.

The company lost 68 cents per share, 38 cents worse than the average estimate of the two analysts that cover it.

Tree.com also said Friday that it had secured a $75 million warehouse line from JPMorgan Chase & Co. through October of next year. Tree.com's chief executive, Doug Lebda, said in a press release that a separate $50 million line was due to expire in December.

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