Summary
From summer 2007 everyone putting their house on the market will have to provide a Home Information Pack. What are they and how much will they cost?
Mortgages. Why selling your home won't be as simple as putting a sign on your front lawn.
Author: Michael Challiner
Every year around 30% of agreed house sales fall through costing sellers £350 million each year. However, as of next summer, it's the Government's hope that the introduction of Home Information Packs (HIP) will greatly decrease the numbers falling through and avoid much of these wasted costs.
So what exactly will go into this Pack?
The Government has yet to confirm the final details but at the moment, it proposes that your Pack must include the following information:
- Search results from H.M. Land Registry
- Replies to anticipated initial enquiries
- Copies of any planning, listed building and building regulations consents and approvals
And for new properties
- Copies of building warranties, electrical test certificates, and any other warranties or guarantees attaching to the property
- A draft sale contract
The Pack may also contain a professional independent survey of the property
- Home Mortgage Loans
- More people are paying off their mortgages early. How do they do it? This article explains some ways.
- Refinance home distilling cash by renewing home loan
- Every year many people refinance their mortgage. Why and what to look out for.
- Buy to Let Mortgages. Boom time returns.
- Buy-to-let mortgages are booming again. What's changed and what, as a new landlord, do you need to look out for?
- Mortgages and Loans. Islamic finance avoids interest.
- Muslims are forbidden by the teachings of the Koran to pay interest. This means that conventional mortgages and loans cannot be used. This article explains the alternatives available for Muslims and defines some of the words used in Islamic finance.
- Mortgages. Watch out for add-on charges.
- Mortgage lenders use headline interest rates to attract borrowers. But behind the scenes they're introducing a whole raft of add on charges. This article explains.
- House price rises – a cautionary tale
- The housing market seems to be buoyant with house sales exceeding expectations in some parts of the country. If mortgage rates start to rise, the market may see a correction. Take care not to take on too much debt.
This is expected to be mid-level survey like the current Homebuyer Survey and will offer far more information than a lender's valuation report – but the Government has yet to announce the details.
However, it seems likely that the Report will have to comment on the property's state of repair, its energy conservation efficiency, the number and type of rooms and parking arrangements. Both buyers and sellers will have a legal right to rely on this Report and there'll be no need for buyers to obtain their own reports or surveys.
We expect lenders to make their own valuations as they do now, but they'll want to maximise the use of the new Home Condition Report to improve their valuations and cut costs to consumers.
The Pack will also have to include replies to searches made of the Local Authority and, i n addition, if the property is leasehold, a copy of the lease, the most recent service charge accounts and receipts and details of the building's insurance and receipts for the premiums paid.
Finally, any regulations made by the management company or landlord will also have to be included. These are all items currently held by the buyer.
And how much is all this going to cost? The Government believes that the Pack is likely to cost sellers around £825 including VAT. But they claim these are not additional costs and make the point that the HIP transfers responsibility for obtaining local searches and a home condition report from the buyer to the seller.
The Government also say that most sellers won't have to pay up front for the pack, which we doubt.
Someone is going to have to pay and we doubt whether solicitors or estate agents will pay upfront on behalf of the seller. The seller is going to have to pay up as soon as the property is put up for sale.
Some commentators predict that this will act as a brake on properties coming to the market. We think that it will dissuade all but the committed sellers – those simply wanting to test the market will probably back off.
Today's Tip
Don't buy direct from a Life Insurance Company or even your bank, until you have received at least two quotes from specialist life insurance brokers. That way you're bound to get a great deal for your life insurance policies.
Today's Tip
If you want cheap car insurance quotations then make sure that you get some quotations from car insurance brokers. Brokers automatically compare prices from the various insurance companies and offer you the best deals. And remember that cheapest is not always best – always check out the details of the cover – for example, whether a courtesy car is provided if your car is being repaired and whether legal assistance or windscreen cover is included. You also need to check out the excess on the policy.
Did you Know?
Cheap secured loans are widely advertised on the Internet but of those applicants who are accepted, 43% are offered a higher rate than the rate they saw advertised (source: Experian). That's why, if you're looking for a cheap secured loan, it's a good idea to apply through a loan Broker. The Broker will know exactly who will accept your credit history and find you the cheapest rates of interest.
Did you Know?
As you already know, personal loans are widely advertised on the Internet. But how can you be sure to find the cheapest interest rate? Research from the UK's largest credit reference agency, Experian, shows that of accepted loan applications, 43% are offered a higher rate than the advertised interest rate. So, if you're looking for a cheap personal loan, it's probably best to apply through a Loan Broker. The Broker will be well aware of which lenders will be happy with your credit history and they'll be well placed to find you the cheapest interest rate possible.
Today's Tip
If you get a life insurance quote from your bank or even direct from a Life Insurance Company, you'll probably find it's very expensive. The cheapest quotes are normally available through an online life insurance broker. These specialist brokers search the market for you - so you're almost certain to get a much cheaper quotation.