Westcorp Will Unload Mortgage Service Rights

Westcorp Inc., the Irvine holding company for Western Financial Bank, said Monday that it plans to sell off its mortgage servicing rights, which will result in a $2.3-million loss after taxes for the third quarter.

The company said last week that it also expects a loss because of a delay in the sale of securities backed by $700 million in car loans.

Although the company will continue to offer mortgages, the servicing of those loans will be handled by the firm that purchases that unit from Westcorp. A sale is expected to be completed by the end of the year, said Chief Financial Officer Lee Whatcott. He said Westcorp is in negotiations with a potential buyer but would not identify the company.

“We think we can realize better returns on our investment in our core businesses,” Whatcott said.

The move could result in layoffs, but Whatcott said it is uncertain how many people could be let go.