View more on these topics

A bad week for the HIP industry

Borrowers got a reprieve last week with the Bank of England’s decision not raise interest rates in June. The Monetary Policy Committee froze the base rate at 5.5% – and a good job too for many people.

Sesame last week revealed that 16% of borrowers are already struggling to meet their mortgage payments, with a worrying 20% not knowing how many base rate rises they’d be able to absorb before they go under financially.

But there was no reprieve for energy-assessors. com and staff at Hipstar. On Friday, energy-assessors.com revealed it was pulling the plug, saying its main backers, Connells Group and LSL Property Services, had decided that “no further investment in this company is considered appropriate at this uncertain time”.

And at Hipstar, the Home Information Pack arm of Network Data, it was revealed that staff numbers would be cut by 40%, with chief executive Stephen Maskens also exiting the firm.

In the wake of the government’s U-turn, it seems that many HIP firms are struggling to survive and no doubt more will fold in the coming weeks.

But the HIP industry seems to be taking its mind off its daily battle to survive financially by attempting to win the public relations war.

For the past two weeks, Mortgage StrategyOnline has been asking in a straw poll whether HIPs should be scrapped. We have discovered that this poll was hijacked by a pro-HIP forum which urged its members to vote to ensure the result would be a resounding no. Alas, despite the forum’s best efforts, with some 6,000 people voting, the result was in favour of scrapping the packs.

While it’s good to see that readers are keen to influence our poll and have their say, the success or failure of HIPs can only be influenced by the government. And fingers crossed, communities secretary Ruth Kelly won’t be influenced by the results of a mere online poll.

Recommended

Commission creates conflict of interest

Most brokers are honest and do things by the book, but the existence of commission means their interests do not always align with those of the clients they serve, says Paul Lewis

E2M calls for clearer HIP implementation timetable

Easier2move has called on the government to introduce a clear timetable for the roll-out of Home Information Packs in order to restore market confidence in the future of the legislation.Karen Babington, sales and marketing director at Easier2move, says: “The recent announcement from the Department for Communities and Local Government is a true confirmation of the […]

Good news for equity release clients

Some welcome news this week from Prudential, which has announced that it is dropping the interest rate on its standard lifetime mortgage product with immediate effect.

YBS commits £100m to OMHB

Yorkshire says it has committed over £100m to the Open Market Homebuy scheme since its launch last October. The society, one of four lenders participating in the scheme, says the scheme could be helping first-time buyers onto the property ladder faster than others who have to rely on a conventional mortgage. It has found that […]

Newsletter

News and expert analysis straight to your inbox

Sign up