You might have noticed that Home Information Packs have been much commented upon lately. I’m still somewhat uncertain as to how this innovation will affect me, as a mortgage broker. But I’m pretty certain HIPs will make it more difficult for me to wrestle clients away from the estate agent’s inhouse financial advisers.In the past I have come across agents who, when dealing with a potential buyer, advise them that they cannot buy a particular property unless they meet the agent’s financial adviser first. This is wrong. Clients are in a vulnerable frame of mind at this time and often don’t realise this is not compulsory. They are also often blissfully unaware that the adviser being recommended often can’t offer them the range of mortgage products they would get through a fully independent broker. I’ve also come across cases where the mortgage adviser attached to an agent has been less than competent or, to be generous, inexperienced. If you were arranging a new mortgage for someone purchasing a property in a long chain, would you not think it important that the client was still party to another mortgage with his ex-wife? In the aforementioned case the sale fell through on the week of exchange, costing the vendor financially and emotionally – to say nothing of how the collapse of the chain affected other people involved. The regulation of estate agencies has got to be a good thing. The HIPs system does incorporate the possibility of redress against an agent for omissions, only in relation to the pack. Agents will have to be part of a redress scheme, though, or they run the risk of being banned. There are also plans to widen the redress scheme to cover estate agents’ activities in general. The sooner, the better. I choose to see Home Information Packs as an opportunity rather than a threat. They offer me the excuse to make contact with local estate agents, surveyors and valuers to see if we can forge closer, more formal links. As yet I remain uncertain as to how exactly these links could work – apart from generating more mortgage referrals – but at the very least this gives me the chance to reacquaint myself with other local professionals and remind them of my existence. Although I am treating HIPs as a chance to make more local contacts and potentially generate business, recent research shows that brokers remain unsure of the effect that the packs will have on the market. A recent survey by xit2 reveals that only 27% of brokers think that HIPs will have a positive effect on the market and just 33% think they will aid intermediaries . One of the most worrying results of the survey is that 67% of those questioned think HIPs could stall the housing market. But whatever the outcome of the HIPs trials next year, a good shake up of the system will ensue, and even if the present proposals do not come fully to fruition in 2007 we will at least have taken a small step along the road to improving the house buying and selling process for everyone. Think positive – but start thinking about how you can use this to the advantage of your own businesses now.
It remains uncertain how the advent of HIPs will affect the average mortgage broker but at least it is an opportunity to refresh contacts with local property professionals, says Sue Read