Irvine’s Frontline Mortgage Buys $800 Million in Rights

IRVINE —  Frontline Mortgage Co. has acquired servicing rights for $800 million in real estate mortgages and is positioning itself to become one of the larger independent regional companies that bill and collect mortgage payments.

The private mortgage banking firm in Irvine would not say how much it paid to buy the servicing rights from FarWest Savings & Loan, the Newport Beach thrift that regulators seized in January. But Frontline raised the cash by selling its own rights to service $230 million in mortgages, said Cliff Piscitelli,Frontline’s president.

Mortgage bankers typically fund home loans, sell packages of those loans to investors and retain the rights to service the loans, taking a small portion of the interest as payment. Major servicers--those who bill and collect on more than $1 billion in mortgages--also buy servicing rights owned by others.

Frontline is the new name for FarWest Residential Services Inc., which was created from the mortgage banking division that Piscitelli and Wendell C. Shirk had set up for FarWest Savings. Besides its own $800-million servicing portfolio, Frontline also continues to handle FarWest’s remaining servicing portfolio of about $400 million in loans.