A company that acquires and manages sub-performing and non-performing residential and commercial mortgages is expanding its share of nonprime business through acquisitions.

Oxford Funding Corp. signed a letter of intent to buy Huntington Financial Corp. as part of its strategy to broaden its subprime residential mortgage business, according to an announcement Monday. Terms of the deal were not disclosed.

Huntington is a commercial and residential mortgage broker that represents over 10 national lenders with traditional and nontraditional lenders. The Houston, Texas-based company arranges traditional and hard-money financing for development, construction and permanent financing of commercial and residential developments, Oxford reported.

"Huntington brings access to funding and will provide a key element to Oxford's growth strategy, particularly as we see increased volume in under-performing mortgage portfolios," said Ron Redd, Oxford chief executive, in the written statement.

Oxford, which specializes in the purchase and management of individual and bulk loan portfolios primarily consisting of sub-performing and non-performing residential and commercial loans, anticipates defaults and foreclosures will rise as $650 billion in subprime mortgages adjust to higher rates by 2009.

The asset management company has said it will take on the opportunity to restructure loans and preserve or restore them to performing status, and additionally expects greater business volume through the implementation of its acquisition strategy.

The subprime "meltdown delivers an unprecedented opportunity for Oxford Funding unheard of since the crisis of the 1990's," he added. Huntington "provides Oxford with open origination capabilities in the nonprime market, which we can build upon to provide access to high-quality deal flow."

Oxford has recently engaged in a series of actions to accommodate its expected growth.

Last week, Oxford announced that it intends to acquire San Felipe Commercial Mortgage, which facilitates hard-money and traditional financing for commercial real estate development, construction and permanent financing. It cited the merger would grow its portfolio of subprime mortgage assets.

A few days prior to that news, Oxford reported it had opened a larger headquarters in Houston and named Redd as its CEO, noting he managed the acquisition, restructuring and resale of over $750 million in secondary mortgage assets during the mortgage crisis of the early 90s.

Robert M. Dunn, who founded and sold San Felipe to Oxford, has been named president of Oxford, according to an announcement today. Dunn, who has held a number of executive positions in mortgage and banking, will have responsibility for operations and strategic planning.

"The acquisition of Huntington is another important step in our strategy of broadening the Oxford's franchise in the subprime residential mortgage business," Redd said. "The addition of Huntington Financial Corporation will further enhance our risk management of mortgage portfolios."