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One way or another it affects you

Submitted by: MikeC (Admin) on 12-Dec-07 02:05:14 AM

On last week's podcast with Paul Broadhead of AHIPP, I mentioned a recent survey conducted on behalf of AXA that claimed 4 million adults were stained with a less-than-pure credit record.

Whenever I first mention (to industry bods) the concern I have for these people trying to procure a mandatory HIP before selling their homes, there's usually a quick dismissal until I press the line-of-argument further by reminding of the many - millions - of people that have little change from their salaries once obligations are met each month.

I want money!

Consumer debt in the UK is currently over £1.25 trillion, the economy is on the dip and next year a swathe of fixed rate mortgage deals expire. Many holders of these mortgages are sub-prime, meaning they will struggle to find comparably affordable/acceptable lenders in this credit-crunched economy.

Actually, I don't know why I have to sell it so hard because you - a DEA - know only too well of the financial pains being felt in the community.

How many DEAs, I wonder, have been "credit-cursed" during this journey to a new career?

Maybe you are one of them?

Unlocking your home... to escape!

In an ironic - yet bitter - twist, maybe the industry you hoped to serve is now the very same that traps you in your home because, basically, you are skint; drained of your savings with nowhere to turn.

Maybe you need to quickly sell, intending to rent somewhere for a while in the hope of salvaging something financially before being pushed... but can no longer afford to?

The point is, it's so easy to become a victim of circumstance and - as 4 million people already know - the credit knife.

Yet this new government-mandated HIP industry is currently set-up to both exclude, and punish, those who might well be acting in their own best financial interests.

Who cares?

Well, you should, for one - Notwithstanding the fact that I might be writing about you; It's your business. Don't you want it?

David Perkins shares anecdotal evidence in his recent musings:

...I have heard of problems where would-be sellers are in financial trouble – serious trouble forcing them to sell their homes. Yet they fail a credit check and the HIP providers will not prepare a HIP, so the agent cannot lawfully put their homes on the market.

Sure, we are only talking about a few people, so what? But of course estate agents do not think like that. Our job is to help, and to help everybody.

HIPs — all properties are go!

When I said on the podcast that this could be a HIP vulnerability, I was really scrabbling for the words, Achilles Heel.

A "free-market" needs fluidity. It also needs those in distress to quickly dispose of assets to best serve both their own interest, and, simultaneously, the efficient running of the "free-market" itself.

If industry is to pre-empt a solution (as it has sought to do with The HIP Code), it should think it through and not forget that negative equity should be a part of that thinking too - In other words, knocking people into further debt when they are trying to get out of debt, is not an option that would go down well... I mean, the industry really doesn't need any more powerful opponents, does it (Citizens Advice Bureau)?

HIPs Trap Homeowners

One of the possible (Daily Wail) headlines to come during next year, I fear.

Aye... Next year; the final year leading into the next General Election.

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