Las Vegas Mortgage in purchase pact

Jennifer Robison

Monday, May 20, 2002 | 11:36 a.m.

Lending Services Corp., a residential mortgage broker with 180 Las Vegas-area loan officers and $230 million in annual lending volume, is merging with direct-marketing firm Consumer Direct of America.

With the merger, locally based Lending Services Corp. and its subsidiary, Las Vegas Mortgage, plan to quintuple the firm's loan volume, and Santa Ana, Calif.- based Consumer Direct will boost its local call center space, both companies said.

Representatives from neither party would disclose the transaction's value, but in a Friday statement, Consumer Direct said the deal includes both stock and cash components.

Raymond Williams, president of Las Vegas Mortgage, said the company will add 20 to 30 loan officers, and will double its current administrative staff of 40.

Despite the small increase in loan officers, Williams said the four-year-old firm could boost its loan volume five times through new efficiencies.

"Loan officers are never working at their maximum volume," he said. "The average loan officer does three to five loans a month. They can do three times that. The average processor does 15 to 20 loans a month -- they could do twice that. The new technology we'll have will enable us to do things more efficiently."

Lending Services Corp. is licensed to broker mortgages in six states -- Nevada, Oregon, Washington, Utah, Arizona and New Mexico.

Williams said 85 percent of its transaction volume goes to Las Vegas borrowers, though that will change: He said he expects the company to be licensed nationally sometime next year.

In addition, Williams said the acquisition will allow the firm to offer more comprehensive benefits to its loan officers.

"Now we can offer insurance, 401(k)s and stock options," perks Williams said have been difficult to offer loan officers because they work for the firm as independent contractors.

"We can also offer (loan officers) leads, and we have marketing tools to give them. We'll have better technology, and we'll be able to do all our underwriting in-house," Williams said.

The mortgage broker will add training classes, including seminars for educating loan officers who want to reach out to Hispanic customers.

Consumer Direct, a Nasdaq-traded company, markets services in three core areas: Phone solicitations for mortgage loans, business-to-business telephone service marketing and group-membership service solicitations.

The company has a mortgage-lending division similar to that of online home loan company Ditech, said Michael Barron, president and chief executive of Consumer Direct.

Consumer Direct employs just under 500 workers companywide at call centers in Las Vegas, Denver, Santa Ana, Calif., and Charlotte, N.C.

It has 300 local employees, and Barron said he'd like to add 100 more by the end of 2002.

"We felt by integrating (Las Vegas Mortgage) into our own mortgage company, we could dramatically grow the business by feeding it lead opportunities," Barron said.

Barron said Consumer Direct has 10,000 square feet of call-center space at 6330 Sandhill Road. He said the company plans to triple that square footage in Las Vegas to create a central hub for its mortgage operations by year's end, though company officials are not currently negotiating for specific space.

Barron said the management and administration of Lending Services Corp. and Las Vegas Mortgage will remain intact following the acquisition, which is scheduled to close June 6. The company will also remain based in Las Vegas, with its current headquarters at 3901 Meadows Lane.

Consumer Direct's shares closed at 45 cents a share Friday, up from 41 cents a share a day earlier.