Crash stymies deals in progress
Mortgage broker Lendi is trying to ease broker concerns after a system outage last week and a possible change to its commission structure.
The outage occurred on Toolbox, a legacy system from Aussie Home Loans, The Australian reported. Lendi and Aussie merged last year.
Brokers were unable to submit loans to lenders during the outage. A Lendi spokesman told The Australian that the issue has since been resolved. However, brokers told the publication that the system still wasn’t operating well this week.
The outage stymied brokers who had deals in progress, with many trying to make sure buyers hit their settlement deadlines.
In an email to staff and brokers, Lendi head of distribution Brad Cramb thanked them for their patience as the firm combated the outage.
“First and foremost, I want to acknowledge that we should have informed you of these outages much sooner, in addition to providing timely and ongoing updates,” Cramb said in the email. “While the issue was an unexpected result of a critical Toolbox upgrade, we completely understand the disruption this has caused.”
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In another email, Lendi co-founder and chief information officer Martin Lam said the company was able to “isolate the cause” of the outage and repair the problem.
“We will conduct a full investigation as is normal in these circumstances and we will share initial findings,” Lam said.
Brokers also said that Lendi was considering a change to its commission structure that could give the firm a bigger cut of each loan. The Lendi spokesman told The Australian that the company didn’t comment on “commercial arrangements.”
Banks usually pay brokers an upfront commission of around 0.65% of the mortgage amount and a trail commission of 0.15% annually. Lendi brokers pay the company a piece of that commission in exchange for marketing, leads and compliance and back-end support.
A change to the commission structure will likely sew unrest among Lendi brokers, it was suggested, especially with the mortgage market slowing, The Australian reported. The Reserve Bank’s repeated rate hikes have stifled sales activity, and more increases are predicted for the coming months.
Lendi has been facing pressure as it attempts to integrate Aussie’s business. Earlier this month, the company announced that two of its four co-founders would be stepping aside, citing different management styles as the reason for the shakeup.
Chief product officer Mark Kalajzich will leave Lendi by the end of this year, while Lam will exit June 30 after overseeing the delivery of the Aussie Ready program. The other co-founders, CEO David Hyman and chief operating officer Sebastian Watkins, will remain with the company.
