The Federal Trade Commission on Thursday filed a lawsuit to block a proposed merger between the nation’s two largest providers of home mortgage loan origination systems and other lender software tools. In a statement, the agency said it is seeking to stop Intercontinental Exchange’s acquisition of a competitor, Black Knight, because the deal would drive up costs, reduce innovation and reduce lenders’ choices for tools necessary to generate and service mortgages.
“This deal would reduce competition in key areas of the mortgage process, ultimately raising costs for lenders and homebuyers,” said Patty Brink, acting deputy director of the Bureau of Competition. The FTC alleged that the merger would harm competition for product pricing and eligibility engines and other various ancillary services that are add-ons to loan origination software.
In a statement, ICE said it would “vigorously oppose” the FTC’s challenge. The company noted it had previously announced it will sell Black Knight’s loan origination system business to alleviate antitrust concerns. “The FTC’s attempt to block the combination, despite this divestiture remedy, is without merit and serves only to delay improving the experience and outcomes for all participants in the mortgage industry,” ICE said.
