Mining the silver lining.

• Author: Nelson, Luann
• Position: Wendover Funding, North Carolina

Mining the silver lining

Back in 1984, when the real-estate business was going great guns, mortgage banker Jeff Taylor picked up and headed East -- from Texas, land of oil wells and hot land deals. He came to Greensboro, where he and partner Ken Austin started a mortgage company for First American Savings Bank.

They stayed with First American two years, then went to work for an Irving, Texas, thrift -- Independent American, which wanted to open a mortgage business in Greensboro. They named the company Wendover Funding for one of the city's main streets.

For two years, Wendover was a full-service mortgage lender, making or servicing some $1 billion in loans and opening six lending offices across North Carolina.

Those heady days seem like a long time ago. Independent American was shut down four years ago by state and federal regulators. (One problem loan was the Piper Glen golf subdivision in Charlotte.) The S&L is now part of Sunbelt Savings of Dallas, set up to take over seven failed Texas thrifts. "It wasn't a happy time," Austin says.

But Taylor, 48, and Austin, 42, have landed on their feet. After Independent American went under in 1987, "Jeff and I continued to work to purchase the company from the government," Austin says. "This was all we knew," Taylor says. "We started it with blood, sweat and tears and someone else's money. The surest and best way to stay employed was to buy the company."

Faced with increasing competition, they also changed Wendover's line of business. They closed the retail offices, going exclusively to loan servicing and subservicing -- collecting payments for lenders and other mortgage servicers. Last June, they completed a leveraged buyout of Wendover from a combination of Sunbelt, Independent American and Resolution Trust Corp. -- the entity set up by Congress to dispose of the assets of failed savings and loans. Taylor is now president and CEO, and Austin is executive vice president and chief operating officer.

In a small way, Wendover is helping clean up the financial mess created by thrifts such as its former parent. The bulk of its business is with solvent thrifts and banks, but close to 10 percent is with RTC.

Wendover does the same thing for RTC as for other customers -- it services mortgages and consumer loans by sending out coupon books and payment notices, chasing down delinquent payments and, if necessary, coordinating foreclosure or repossession of collateral. Fees range from $6 to $10 a month per...