The mortgage technology group announced the sourcing system provider would enter administration due to a significant loss in revenue, in part due to a substantial payment awarded to a former member of staff following an employment tribunal claim.
Mortgage27 received an employment tribunal claim in 2013 after it looked into to purchasing assets from CDS Group which subsequently went into administration. The employee of CDS Group retargeted the claim at Mortgage 27. The employment tribunal, ruling in favour of the claimant, received a substantive award as he had not received any back pay for a number of months from his previous employer.
Mortgage27’s business to consumer (B2C) system, which operates on broker websites will no longer function, while the group’s remaining subsidiaries Mortgagesource tec, Mortgageapply tec and Loansource will continue to operate.
Tucker said there were around eight clients still using the B2C sourcing tools.
Tucker said that no redundancies would be made and financial losses would only sit with Mortgage27.
“It has absolutely no impact on Twenty7Tec Group in any way, it’s one of the subsidiaries we own and one of the businesses that has been declining in revenue significantly, we haven’t been investing in it for some time,” he said.
“So ultimately the intention is just to close it down and leave it. There’s a very limited number of customers who use those iframe tools now. From a Twenty7Tec Group perspective we’re not interested in going back into that market so I think those clients will have to decide whether they go to MortgageBrain or TriGold and buy one of their plug-in tools.”
Earlier this month Twenty7Tec launched a second charge and bridging sourcing system, Loan Source, which allows brokers to make comparisons alongside mainstream mortgage products.
The group also has plans to launch an application submission platform in the next 12 months.
