|The Money Store is back. But don't look for subprime loans, TV commercials or Phil Rizzuto this time around.
Over nearly four decades beginning the late 1960s, the Money Store, with its memorable if not irritating commercials featuring the former New York Yankee great and announcer, offered subprime home equity loans to its television audience.
So successful was the company that it was acquired by First Union Corp., a Charlotte, N.C., financial services company, in 1998 for $2.1 billion -- about the time the subprime sector suffered a meltdown.
At the time of the First Union purchase, The Money Store had 120 branches in 34 states and more than 4,800 employees.
"First Union and The Money Store are ideal partners," Money Store CEO Marc Turtletaub, the son of company founder Alan Turtletaub, said at the time of the merger in a company statement. "We decided to combine with First Union only after a thorough examination of all strategic alternatives."
Just two years later, The Money Store was out of business, a victim of a busted subprime bubble.
But MLD Mortgage of Fordham, N.J., has resurrected The Money Store, albeit with a new business model and without Phil Rizzuto.
MLD purchased The Money Store two years ago from Wachovia Corp., the financial services giant that had acquired First Union. MLD is actually operated by former Money Store executive Morton Dear, who is also CEO of NorCrown Bank in New Jersey.
"During ... Dear's tenure at The Money Store the company grew from a small, privately held finance company with $8 million in annual sales volume to a New York Stock Exchange Company with sales volume of $10 billion," according to a NorCrown statement.
Rather than using its once omnipresent branch network The Money Store is now using an Internet and call center platform to allow borrowers to compare loans and submit applications online.
And it another radical departure from its roots MLD is using The Money Store is make prime loans.
"The Money Store revolutionized mortgage lending in the seventies by making borrowing against your home possible for millions of homeowners who couldn't find a willing lender," the company says on its Web site. "The information age has created a more sophisticated consumer and our research indicates that the borrowing community is ready to take control over the lending process."
Like other mortgage company Web sites The Money Store allows customers to shop for the best rates and loans products from "national wholesale lenders" across the country. That allows it to offer competitive rates, the company claims.
As of Oct. 5 The Money store was posting a 15-year fixed rate mortgage at 5.25 percent for customers with good credit, while Freddie Mac reports the average 15-year fixed rate was 5.98% in its latest survey.