Firstplus Financial Group

After failing to find a buyer, beleaguered home equity lender FirstPlus Financial Group said Thursday that it will sell off several affiliates, fire 3,000 people and close a major marketing center in Orange County. The Dallas-based company, one of several "sub-prime" lenders felled by the global credit crunch and disarray in the mortgage lending market, said it will move its direct-marketing operations from Mission Viejo to Dallas as part of the consolidation.

After failing to find a buyer, beleaguered home equity lender FirstPlus Financial Group said Thursday that it will sell off several affiliates, fire 3,000 people and close a major marketing center in Orange County. The Dallas-based company, one of several "subprime" lenders felled by the global credit crunch and disarray in the mortgage market, said it will move its direct-marketing operations from Mission Viejo to Dallas as part of the consolidation.

Home equity lender FirstPlus Financial Group Inc. said Tuesday that third-quarter earnings plunged 70%. The company also told investors and analysts in a conference call that it faces hurdles before it can close an agreement to sell off key portions of its business to Coast-to-Coast Financial Corp.--a sale that's essential to its survival. "If the Coast-to-Coast deal, which is dependent on financing, isn't completed, they're going to be out of business," said Michael Abrahams at Sutro & Co.

FirstPlus Financial, which closed its home mortgage affiliate in Mission Viejo last month and folded the unit into the parent company in Dallas, has been sued by a pair of vendors who contend they are owed nearly $750,000. Entex Information Services Inc. of Massachusetts, a supplier of computer networking equipment, was not paid for $381,139 in high-tech goods that it provided from May through September, according to a lawsuit filed in Orange County Superior Court.

Although two subsidiaries of Dallas-based FirstPlus Financial Group filed for Chapter 11 bankruptcy recently, the move will not affect the Tustin-based banking affiliate, the lender's president said Monday. The two divisions, FirstPlus Financial Inc. and FirstPlus Special Funding Corp., have filed for protection from creditors. But FirstPlus Bank is "well capitalized and very profitable," said president Mike McGuire, adding that the bank has $246 million in deposits.