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The acquisition gives ETrade niche products to market, like high-LTV and subprime loans.
E-Trade has now added mortgages to its Web site with its purchase of LoansDirect.com. The deal continues a consolidation pattern among online financial services and mortgage companies.
Nick Karris, real estate analyst, Gomez Advisors, Waltham, Mass., said that the E-Tr`ade acquisition of LoansDirect is part of a continuing pattern of behavior among online financial services companies.
"The idea is to provide consumers onestop shopping so they can simplify their lives aggregating all their financial information with a trusted provider," Karris said.
Anthony Hsieh, president and chief executive officer, LoansDirect.com, Huntington Beach, Calif., said that he had spoken to a number of companies but was selective in picking E-Trade. Hsieh said that it took a couple of years for LoansDirect to find the right partnership, but the company felt it had the time to pick the right company.
LoansDirect hit the number two ranking in the Gomez Advisors Winter Internet Mortgage Scorecard released in November and ranked number one in consumer confidence. In December, LoansDirect funded more than 1,000 loans. E-Trade does not have any mortgage exposure, but it does have a large customer base with a high net worth.
There are 3.3 million E-Trade customers that go to the consumer-oriented site and LoansDirect.com increases the potential for E-Trade to cross-sell its customer base....