MortgageTree Lending Corp., a Mo-desto-based mortgage company with 390 employees in 32 states, is being acquired by W.J. Bradley Company Merchant Partners of Denver.
The deal, formally announced today, is expected to be final in late May. Terms were not revealed. Both companies are privately owned.
MortgageTree is a retail originator of residential mortgage loans. It acts as both a mortgage banker and broker. In 2006, it originated $788 million in conforming, nonconforming and subprime residential mortgage loans.
Most of MortgageTree's staff and management team will keep their jobs, but about 25 employees at its Modesto headquarters were laid off last week, according to Bill Campbell, a spokesman for W.J. Bradley Co.
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Campbell said their duties will be taken over by the centralized operation in Denver.
"We were looking for a partner who could help us work through the current challenging market environment and give us a better platform to grow when market conditions improve. We are already taking steps to restructure our operations to reduce costs and eliminate redundancy as we move onto W.J. Bradley's centralized fulfillment platform," said Diana Grossman, MortgageTree's president.
Grossmann will keep her post, along with Chief Operating Officer Robert Draizen. They will be responsible for implementing strategy and managing day-to-day operations.
Draizen and Grossmann "will continue to have a financial interest in the company's future," according to a statement issued by W.J. Bradley Co.
MortgageTree will retain its name and its 55 retail branches.
The company has gone through numerous changes since its founding as First Concord Mortgage in 1986. It became MoneyTree Lending in 2000, then switched to MortgageTree Lending in 2003.
By 2004, the rapidly growing company had about 500 people working as loan originators in 70 branches across 35 states, plus more than 50 employees at its headquarters at 100 Poplar St., Modesto.
For a time, its executives also occupied the 15th floor of the DoubleTree Hotel in downtown Modesto.
The company reported originating about $1 billion a year in residential mortgage loans. Its business declined significantly by 2006, however, originating fewer loans from fewer branches. Some closed, including one in Turlock.
MortgageTree isn't the only lender that's suffered business declines. Many mortgage companies nationwide have closed, downsized, merged or gone bankrupt in recent months because of the slow real estate market and soaring foreclosure rates.
W.J. Bradley, however, has been growing. It is an acquisition firm that is consolidating smalland medium-sized mortgage brokers and banks.
"Our strategy is to grow our origination network by focusing on quality originators like MortgageTree that have a track record of profitability and are well-positioned in their markets, but also have a need for capital and scale to grow," said William J. Bradley, who founded the company in 2003 and is its president and chief executive officer.
W.J. Bradley Co.'s portfolio includes mortgage banks and brokers operating in 40 states and employing more than 1,600 loan professionals. In 2006, it origi-nated more than $5 billion in residential mortgage loans.
Bee staff writer J.N. Sbranti can be reached at 578-2196 or firstname.lastname@example.org.