UK mortgage intermediaries uncertain over HIPs

The UK's Association of Mortgage Intermediaries has released the results of its survey on the impact of home information packs (HIPs), with most respondents uncertain about the precise implications of the changes.

From June 1, 2007, house sellers in England and Wales will be required to arrange a HIP before putting the property on the market. The government says HIPs will speed up buying and selling by making information readily available at the start of the process and less likely that property transactions will fall through. The Association of Mortgage Intermediaries' (AMI) April mortgage intermediary census on HIPs has revealed a majority of AMI members are already considering how the introduction of HIPs will affect their businesses, although most believe home sellers will approach estate agents first to arrange their HIPs. The results of AMI's census revealed 68% of members are considering the impact of HIPs on their businesses while 88% feel sellers will approach estate agents first in order to arrange their HIPs. AMI has previously drawn attention to potential 'unintended consequences' with the implementation of HIPs, such as the potential for some property companies, estate agents and lenders to use the HIP as a marketing tool to offer mortgages and general insurance products to the prospective house purchaser. This may restrict the consumer's access to advice and the full range of products. AMI members felt only 3% of sellers would approach lenders first. Rob Griffiths, associate director of AMI, commented: It is pleasing to see the majority of members considering the impact HIPs will have on their businesses, but results from our census seem to show there is still a large degree of uncertainty in the mortgage intermediary community. Many seem to be holding back and waiting for further information before making concrete business plans. This uncertainty may now be heightened by the recent decision to replace the Office of the Deputy Prime Minister with the Department for Communities and Local Government. How this might affect the delivery of HIPs within the government's recently published timeline remains to be seen.