Despite rumours that Home of Choice (HOC) had gone into administration last week after the failure of acquisition talks, an 11th hour statement by chief executive officer Gerry O'Brien suggests that the business could still be saved.
News broke last Thursday that the network had gone into administration, leaving its 550 appointed representatives (ARs) scrambling to save their own businesses and find a possible new network.
Now O’Brien has asked them not to cancel their contracts with the network, as a potential investor could still be secured.
He said: “Let me clear up a misunderstanding – Home of Choice is not in administration. The directors had to file a ‘notice of intention’ to appoint administrators under our fiduciary responsibilities.
“HOC is currently in serious negotiations with a significant investor who is looking to safeguard the going concern status of the business. We and the investor are seeking approval from the FSA and we expect them to respond early this week.”
Some brokers had already made plans to meet this week to try to salvage their businesses and discuss possible moves to new networks. Now they have been given a stay of execution from Home of Choice which said it hopes to provide a further update on Tuesday 4th May – including assurances on commission and fees owed.
But for some it could be too little too late. One Home of Choice AR, who wished to remain unnamed, told Mortgage Solutions: “I’m pretty angry. The communication from the network has been abysmal and I’m shocked. I will be registering my protest with the company in the strongest possible terms. They could have done better when people’s livelihoods are at stake and they also could have shot themselves in the foot over this.”
Fahim Antoniades, former HOC AR and now group director of Mortgage Centre IFA, said: “They need to keep communicating so that ARs are not disadvantaged. The negotiations may or may not come through, and if they don’t, they have a duty to let everyone know as soon as possible.”
He also claimed this throws into question the whole network and AR model. “Being an AR is potentially outdated. We’ve come full circle to a place where it is safer to be directly authorised. It is the best way brokers can control the flow of commission.”
While things remain uncertain, affected ARs may still want to scope out other options. Sally Laker, managing director of Mortgage Intelligence, advised HOC ARs looking at other networks to do their research before committing: “It is crucial that brokers know who they are dealing with.”
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