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ISCOVER
Jessica Darnbrough
Refund Home Loans could be heading for collapse with reports that a large number of franchisees have launched legal action against the parent company.
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Speaking to The Adviser, a source within the Refund Home Loans franchise network said up to 50 franchisees have served the brokerage with breach of contract notifications.
In addition, the source claimed that many franchisees were on the verge of walking out – not only from Refund but the industry altogether.
"Refund has handled the whole situation very badly," the source told The Adviser.
"They have not done the right thing by their brokers. They have failed to meet their contractual obligations in five or six ways. Brokers are so disillusioned that they want to leave the industry altogether."
According to the source, Refund Home Loans has not only failed to pay broker commissions, it has also reneged on customer refunds.
The Adviser made numerous attempts to contact Refund's administrator SV Partners regarding the latest developments, however our calls were not returned.
Late last month SV Partners told The Adviser that while the company would continue to pay commissions on loans settled from the time the administrator was appointed, it was trying to work out the logistics surrounding commissions on loans that were settled prior to the company entering administration.
