The Council of Mortgage Lenders says that people borrowing money from its members to buy new homes w...
The Council of Mortgage Lenders says that people borrowing money from its members to buy new homes will be covered by a new guarantee as of 1 April.
The arrangement will ensure that new homes are fully completed and have undergone a satisfactory final inspection before the lender releases any funds and the buyer can move in.
The CML says the new scheme will safeguard buyers from problems that have occurred in the past and will also stop buyers suffering additional stress when it comes to buying a new property.
"Our new initiative will ensure that in future everyone taking out a mortgage to buy a new home can be confident that it has been satisfactory completed and a new warranty is in place," says Michael Coogan, CML director general.
"This is an important additional step to reduce stress in the house-buying process."
The initiative comes into force on 1 April and applies to all transactions involving new properties being built or converted.
CML members account for approximately 98% of all residential mortgage lending in the UK, and the new arrangements are supported by the House Builders Federation, the Law Society and firms providing warranties on new homes.
Today's news comes after a survey by the Royal Institution of Chartered Surveyors (RICS) shows that UK house prices have dropped for the first time in two years in the largest fall since 1995.
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