Cendant Steals Home

Cendant's (NYSE: CD) got many revenue streams, and apparently they all lead home. So perhaps it's understandable to see the multifaceted company pull back from the pending sale of its mortgage business. Last month Cendant revealed that it was in talks to sell its home financing unit. Without naming the suitor -- and not that it matters whether it would have been Countrywide (NYSE: CFC), JPMorgan Chase (NYSE: JPM), or H&R Block (NYSE: HRB) -- Cendant broke off negotiations last night.

The divestiture didn't make a whole lot of sense anyway. You can tie many of its businesses such as its Century 21 and Coldwell Banker realtor subsidiaries to the potentially lucrative art of funding homesteads. Even the company's core of travel offerings such as Avis car rentals, CheapTickets.com, and its Ramada, Days Inn, and Travelodge lodging establishments can play a crucial role in the relocation process.

So while Cendant may have been looking to cash out of the mortgage market before the historically low rates washed away the sector's value, would it have been worth it? Even if the company were to stipulate that the logical associations between Cendant's businesses remain, what price would those shackles fetch?

Cendant still thinks that it can have its cake and eat it too. The company will still consider other buyouts and strategic proposals. With Countrywide announcing approval for a two-for-one stock split, it's obvious that some key players think that the mortgage business boom is only getting started.

While higher rates are clearly on the way, that doesn't mean that folks will be anchored to their existing homes. So don't give up on the mortgage business just yet, Cendant. You've already got plenty riding on a healthy real estate economy. Why dilute that wager?

Should Cendant unload its mortgage business? What are you doing around the house to fix it up if you're not going to move soon? Can you minor in major home improvements? All this and more in the Building/Maintaining a Home discussion board. Only on Fool.com.

Longtime Fool contributor Rick Munarriz has stayed in most of Cendant's hotel chains, but he does not own shares in any of the companies mentioned in this story.