eChoice extends its debt facility

Mortgage company eChoice (formerly Firstfolio) has secured an extension of its senior debt facility by two years. The company announced yesterday that the A$58.4 million facility would mature in July 2018.

eChoice's senior debt provider is Welas Pty Ltd, an entity related to eChoice director Anthony Wales.

eChoice has completed a major restructure of its business over the past year. It had been in a state of flux after an ill-timed acquisition spree left the company with a heavy debt load just as a downturn in the mortgage market cut into revenue.

The business operation is on a sound footing but its large debt burden remains an issue. Finance costs are one of eChoice's biggest expenses and its margins are shrinking.

eChoice chief executive Peter Andronicos said in a statement that the company was committed to repaying at least $5 million a year of its senior debt and would investigate "other options" that would enable additional repayments.