Online mortgage application is poised for a meteoric rise not unlike that of online stock trading just a few years ago, says the chief executive officer of one of the nation's top online mortgage services.

"This is like e-trading was back when it started in the single digits, and in two years it has grown to be a (dominant part of the market)," said Chris Larsen, CEO and co-founder of E-Loan. "With the rate of growth we expect, the challenge is going to be keeping up our growth on the back end."

E-Loan is one of a half dozen major companies that serves homebuyers in the market for first and second home mortgage loans over the Internet.

Users of online mortgage service -- potential borrowers -- can search for and apply for loans with a simple user interfaces.

E-Loan differs from many other services in that it displays customized product quotes and comparisons that do not require the intervention of a loan agent. E-Loan's product comparison services do not provide a link to a "calculator" which forces the borrower to analyze various offerings. Instead, E-Loan recommends the best product to the borrower based upon the borrower's response to qualifying questions regarding debt objectives, risk profile, hold period and other financially sound criteria.

Larsen declined to say how many applications E-Loan has took and how many were funded in the month of August, saying such numbers can be manipulated or misleading. Larsen did, however, provide the total amount of loans funded in the month of August -- $90 million.

"What is important is dollar volume, closed and completed," he said. "And for September, we are anticipating $105 million in loans funded."

Larsen said he has seen about 20% growth month in the total amount of loans funded.

Countrywide Credit Industries Inc., the nation's largest independent residential mortgage lender and servicer, funded $7.3 billion of mortgage loans in August 1998.

The e-commerce division, which takes mortgage applications for purchases and refinancing online through the Internet, took more than 840 new applications for a total of $90 million in August 1998. Of that, 520 were funded for a total of $57 million. Countrywide differs from other services in that it funds its own loans in-house, rather than shopping them around to other lenders.

Cameron King, executive vice president at Countrywide responsible for Countrywide's e-commerce, said that like E-Loan, he has seen consistent growth.

"The number of online loans we do is increasing at a rate of 11% a month," King said. "It's like clockwork."

A spokesman for Microsoft's HomeAdvisor online service, which has only been up and running about 45 days, said the company did not want to release any figures on loans applied for or funded yet.

Likewise, a spokeswoman at HomeShark Inc. declined to give loan application, loans funded, or total loans funded figures.

"Nope, we're a private company and we don't want those numbers out there," said Laurel Peppino, communications manager at HomeShark.

Sources at QuickenMortgage, one of the other major industry players, could not be reached for comment for this story.

Smaller, more regional-based players are entering the market every day. Continental Savings Bank of Seattle announced this week it is jumping into the market, offering homebuyers loans through its Internet Home Loan Program, or IHeLP.

``We are striving not only to provide our existing customers with easy access to our products and services, but, also to establish relationships with potential customers who would not otherwise learn about us,'' said Rich Bennion, executive vice president of residential lending at Continental Savings Bank.

Most say the popularity of online mortgage applications is driven primarily by the convenience of using the Internet for a time-consuming process. In addition to speed and convenience, consumers can save money.

"Consumers are starting to see that online applications are a better way," Larsen said. "It eliminates a lot of the costs -- there's no commission with E-Loan -- and people can track the status of their application 24 hours a day."

And while with only a week in the business under their belts it's too early to see how they are doing, executives at Fluential Systems Inc. say they are pleased with last week's launch of LoanHound. LoanHound is a new online mortgage comparison-shopping service.

``We knew that the consumer market was ready for an online mortgage service that really focused on the human element of the lending process and we were prepared for a successful launch of the site," said Jeff Glass, founder and president of Fluential Systems, the developer of LoanHound.