HMOs came into force this week on properties with five unrelated tenants or that are over three stories high, and while affected landlords have been preparing for its implementation, lenders are concerned brokers have not.
It is feared intermediaries are not fully clued up on its impact and that they won’t be able to advise potential clients because of it.
Jennifer Holloway, head of media relations at Skipton Building Society, said: “Our regional intermediary sales managers have come back to us and said their conversations with brokers have shown they are blissfully unaware of the new legislation and it’s our concern that they are not informed enough to give advice on it. We believe over 50 per cent of brokers are unaware of the rules.”
Mark Sismey-Durrant, chief executive of Heritable Bank, is also concerned. “Brokers are probably like landlords, as in many cases they are unaware of what is going on except for what they have been reading in the press. As much of the information is coming through local authorities, who don’t seem ready in many cases, I suspect both brokers and landlords are waiting to see what happens.”
John Heron, managing director of Paragon Mortgages, said: “The general IFA who only does occasional buy-to-let business probably won’t know about it. However, the small landlords they deal with don’t buy HMOs so their vulnerability to the regulations and the broker’s knowledge shouldn’t be a problem.”
