Ombudsman backs Home Improvement Guarantee Scheme to stop building disputes
The head of redress at the Property Redress Scheme (PRS), a leading figure in property disputes, has recommended industry professionals to join the Home Improvements Guarantee Scheme (HIG) – the initiative set up to prevent disputes between consumers and builders.
PRS head of Redress, Sean Hooker has publicly backed the scheme in a bid to try and reduce the number of expensive incidents between builders and consumers around the country.
“Agents are often asked for recommendations for builders by clients and I am happy to say that the HIG is a worthy solution, strengthening the bond between builder and clients and adding value to the service” he said.
Agents and any other professionals who recommend the HIG will earn a commission for any work carried out through the scheme, but crucially Sean says he hopes increased use of the HIG will reduce the chances of any disputes because of the scheme’s structure and built-in complaints procedure.
The Home Improvements Guarantee (HIG) is the brainchild of Harvey Ellingham, an electronics engineer, builder and businessman who had the idea after his elderly parents were ripped off by cowboy builders for £23k.
It involves HIG sourcing and vetting builders from all over the country, then arranging quotes from three traders to maintain competitive forces during the tender process.
HIG has access to more than 1,000 builders around the country and Sean says it could prove invaluable. All builders must agree beforehand to sign up to the terms of the guarantee before bidding for any projects.
“Having met Harvey I believe this is a fantastic scheme designed to build consumer confidence in the building industry. Both the consumer and the builder are protected by the scheme and the agent can also benefit with a share of the commission.”
“By placing the money in an independent account the consumer knows that their money is safe, whether the builder does good or bad work, goes bust or just disappears.
“This gives peace of mind to both parties; the builder can see that the customer has the money and the consumer knows they don’t have to pay until they’re happy with the work that has been done.”
Once all the stages have been completed, and the consumer is 100% happy with the work that has been done, the final payment is released. If any extras crop up along the way, the homeowner must sign and agree to the extras being carried out. The extras are only paid for when they too are completed.
The scheme is free to consumers because the builder pays a levy equivalent to 3% of the net value of the job (i.e. net of VAT) to HIG in return for being on the database of recommended builders.
“Builders are often charged as much as 10% or 12% by other property professionals such as large building firms or even estate agents for being referred for work, so this 3% level is generally absorbed as part of their costs.”
Finally, the scheme also offers an insurance backed guarantee which provides additional security over and above the tradesman’s own guarantee. It is valid for up to 10 years and insures the homeowner against the tradesman going bust, disappearing, or problems with the quality of the work.
“All HIG accredited builders have to give a guarantee on their work but we provide extra cover to ensure that the consumer is protected whatever happens to the trader – if they go bust or move abroad, for example, and it ensures that if problems emerge with the quality of the work in that guarantee period we will provide another builder to assess and rectify any issues.
“If the builder disappears with the money, that is covered by our guarantee as well.”
The Property Redress Scheme blog about the HIG can be read here: https://www.theprs.co.uk/news/
There is a video on the HIG website which helps explain the concept.
View at www.homeimprovementsguarantee.co.uk