Abode Mortgage Holdings Corp. (TSXV:ABD) has agreed to sell its mortgage origination business to a private Vancouver-based investment firm for $3.5 million, the company said Friday.

Under the agreement, the new owner will pay Abode by annual cash installments for the shares of its wholly owned subsidiary, Abode Mortgage Corp., and related entities.

The sale “will recapitalize the business so that operations can be continued on a seamless basis under the new ownership,” Abode said in a release.

The decision to sell Abode Mortgage Corp. was accelerated by the termination of a funding agreement by Abode’s financier and whole-loan purchaser.

Abode said it has made arrangements for interim funding and mortgage loan purchases, and is in discussions with several financial institutions to provide replacement lending and mortgage purchase facilities.

The sale is subject to a number of conditions including a definitive agreement and shareholder and TSX Venture Exchange approval.

IE