Hop Homes - Anyone got any experience?

cgb_uk83

Hi All

i came across a company called Hop Homes who offer an alternative to mortgages, essentially offering a shared investment in a property instead. Essentially you stump up 10% of the value of the property (they will work on 6x salary), you then make a monthly ‘hop’ payment, which then increases with RPI each year, capped at 5%.

Has anyone here worked with them before? All looks very new but as an individual with a patchy credit history but money in the bank, it looks like a (somewhat) viable option.

Anyone live in a Hop Home? Any feedback? Thank you!

D.L

Sounds pretty awful compared to a mortgage. You pay 5% (the FAQs say this actually starts at 5.5%) of the amount invested by Hop Homes in year 1, increasing with RPI. This doesn't go towards paying anything off, it is just what you owe in return for them investing in your home. You owe this for 125 years. The FAQs say you can increase your share at any time up to twice a year, effectively buying them out of their investment - "there will be associated costs to pay", unclear what these are. Best case scenario, you can simply pay a lump sum and reduce the amount they own by the same amount. However, I suspect that this will be costly as they otherwise have an asset returning 5%+ for 125 years.

I hadn't heard of them before but it doesn't seem like a great offer even on the surface. If you are looking to use them, I would make sure to get to the bottom of exactly what you are committing yourself to.

FreeBear

The business is not regulated by the FCA, so that should throw up red flags for starters. Reading between the lines, it appears to be a peer to peer lending platform - You need to ask yourself what happens when the "investors" want out or the company goes bust. Most likely, the assets (i.e. your home) would have to be liquidated and you'd get precious little in return.

 David Toplas, the founder and CEO of Hop Homes, set up a "Generation Rent Fund" on the stock market back in 2014 - It was liquidated less than a year later and the investors lost a considerable amount of money in the process. Doesn't inspire confidence in his latest offering.

numbercruncher8

From both an investor and buyer point of view, it sounds like a terrible idea.

The company have no track record at all, some of their staff don't even mention the company on their LinkedIn, or are 'searching for new opportunities'. It smacks of Lendy in their dying days, basically a desperate scam to get some cash in.

You'd be better off speaking to a mortgage broker.