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Effective 8 March 2023, the new commission rates have changed from 0.65 per cent for upfront to 0.75 per cent and trail has changed from 0.15 per cent to 0.20 per cent. Resimac has stated that pipeline applications that have not been settled prior to the commencement date will also benefit from the increases.
Resimac’s general manager distribution, Chris Paterson, said the non-bank lender was “committed to providing better support for brokers who service self-employed and credit-impaired borrowers”.
“As the specialist for the self-employed and credit-impaired, we recognise the additional time, effort and skill that brokers put in to service these kinds of clients, and we have increased the upfront and trail commissions on our Prime Alt Doc and Specialist products accordingly,” Mr Paterson said.
“With this increase to commissions, we’re hoping to get more brokers interested in diversifying their client base beyond prime customers.
“Resimac’s Prime Alt Doc and Specialist products are a great fit for self-employed and credit-impaired clients, and we encourage brokers to speak to their Resimac BDM or Relationship Manager to learn more.”
Drop in settlements
Resimac’s home loan settlements dropped 32 per cent in the half year ended December 2022.
The results showed a marked slowing in prime mortgage originations and an overall drop in new settlements.
According to Resimac’s results, it settled $2.4 billion of mortgages in the “challenging market” of the first half of the financial year, which was down $0.9 billion from the record high of $3.5 billion on the previous corresponding period.
Resimac group chief executive Scott McWilliam stated at the time that this reflected a 30 per cent decrease in system purchase activity and flagged fierce competition for prime owner-occupier settlements with “low interest rates fuelled by the RBA funding for ADIs (TFF), unusually high household savings, and cashbacks providing large banks a competitive advantage”.
Specialist loans once again dominated the non-bank lender’s flows with $1.6 billion of new loans being specialist in 1H23.
Mr McWilliam spoke to Mortgage Business, commenting: “We are active and competitive in the prime space at different times through different cycles; but the focus right now — from a mortgage perspective — is absolutely in the specialist market.
“We are not looking to follow the bank’s lead, where they’re willing to write business below cost of capital.”
[RELATED: Resimac settlements drop 32%]