Hoping to capitalize on a refinance boom now in its fourth month, Dexma Inc. has developed an online system designed to help lenders retain their customers by flagging them as refinancing prospects and serving them accordingly.

Officials of the Minneapolis company say Portfolio Protector can help identify refinancing candidates and show what a refinancing might cost or save. They also say the software will make sales and processing more manageable by automating part of the refinancing process.

"History shows that 75% of borrowers who refinance will use a different lender than the one servicing their existing mortgage," Dexma president Stephen Mase said. "We believe our tool will help lenders defend their mortgage portfolio from being eroded during refinancing booms."

He said an added benefit is a reduced workload for loan origination and telemarketing staff swamped with refinance applications.

The software, which was unveiled today and is to be made available in May, operates through individual lenders' Web sites. Customers visiting such a site to check their loan balance, for example, would be notified that they could save money if they were to refinance, and how much. They would be pointed to an icon that they could click to get details about loans available to them, and the system quickly generates a price quote and product recommendation, automatically analyzing the current principle and interest against various refinance scenarios.

Mr. Mase said information is one of Portfolio Protector's strengths: It elicits data and gives answers to common questions about monthly payments, cost savings over the life of the loan, and the maximum amount of cash customers can get out of the transaction.

"The biggest problem in refinancing for the lender is in describing the particular products and letting the customer know what products he or she is qualified for," he added.

Portfolio Protector is a refinement of an Internet servicing platform that Dexma, which was founded in 1995, released in 1998. The previous product could tell customers how much they could save by refinancing using a typical refinance loan, but it could not give them a price quote or help them choose a loan.

Dexma says the upgraded version will also help borrowers and lenders decide how to handle the closing costs of a refinance loan - for instance, whether to increase the loan amount or interest rate to cover costs, or pay out of pocket. Moreover, it says, lenders will be able to use the program to automatically execute the steps necessary to get credit and underwriting approval from Fannie Mae or Freddie Mac, or conduct an internal review.

Portfolio Protector lets the lender perform those functions, Mr. Mase said. This aspect of the product should help lenders preserve their margins, he said.

Dexma claims the online mortgage industry's largest customer base, its clients including major lenders RBMG, National City Mortgage, First Horizon Home Loan Corp, Old Kent Mortgage, and First Nationwide.

Mr. Mase said that Dexma, after losing money in 1999 and 2000 because of investments in infrastructure, research and development, and staff expansion, opened 2001 with a positive first quarter.

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