Some lenders insisted in the agreements that packagers should take responsibility for all brokers including those operating as directly authorised firms.
Jon O’Brien, operations director for packager alliance The Professional Mortgage Packagers Associates (PMPA), claimed lenders had attempted to force the new contracts through by failing to let packagers have enough time to have them legally checked.
“It was rather like a spin doctor trying to bury bad news on a day when something else important happened,” he said.
“Unfortunately some of our members were forced to sign them so they could continue writing business but we believe that we can get a number of these contacts amended so they don’t leave packagers carrying all the risk.”
Bill Warren, director of The Complete Network, agreed. “There is real concern that lenders left this to the last minute on purpose to put packagers in a position where we had to sign them. It does not bode well for future relationships,” he said.
Tony Jones, managing director of Pink Home Loans, claimed that the contracts presented to him where far too detailed to digest in the short space of time given. “These were very thick documents and there was no way we were simply going to sign them without studying the full implications for out business first,” he said.
However he went on to say that some of the lenders concerned had relented and progress was being made.
