Mortgage intermediaries and brokers will have to accept use of Sellers Packs in the homebuying proce...
Mortgage intermediaries and brokers will have to accept use of Sellers Packs in the homebuying process, say officials at Mortgage Talk, but work on the legal aspects and conveyancing is still needed.
Peter Birch, director at independent broker firm Mortgage Talk, says now the proposal has been mentioned in the Queen's Speech, advisers have to accept they are part of working practice, even though they have done little to improve the legal position for people selling their homes and increased selling.
"Much of the mortgage industry is sceptical about the alleged advantages of this proposed legislation, especially the Government's claims that it will streamline the house buying process," says Birch.
"What is worse is that there will be an increased cost to the seller simply to put their property on the market. Some commentators have naively suggested that the new system will be cost neutral, as most house sellers are also buying. This is not the case as, although the seller will need to pay an estimated £500 to prepare the Sellers Pack, most lenders will still want to instruct their own valuer to inspect a prospective borrower's new home. In practice, this means that there will be two valuations or surveys required on each property being sold," he argues.
Mortgage sellers packs are being introduced in an attempt to speed up the housebuying process and limit the amount of gazumping some housebuyers face, by allowing the seller to conduct their own conveyancing and legal work, at a cost of around £500 per time.
"Surely, a better way to reduce the complexity of the conveyancing process, and consequently the time taken for each transaction, is to simplify the legal procedures involved in buying and selling," continues Birch.
"That would speed up the time between offer and exchange, and hence reduce the possibility of gazumping. Moreover, many commentators seem to forget that, while gazumping might be an issue in a demand-led market, the opposite is true in times of low demand, when sellers outstrip buyers," he adds.
"Overall, I fear that the suggestions contained in the Homes Bill will increase the already high costs of moving, when the Government should really be focusing on helping the legal profession devise a swifter conveyancing process. Having said that, it looks like we have no choice but to accept the proposals, and work with them to the best of our abilities," concludes Birch.
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