With Home Information Packs (HIPs) due to go live on 1 June 2007, the CML has warned in its ‘Mortgage lenders, HIPs and the future of valuations’ report the late publishing by the government of the technical standards has left it ill-prepared for the launch date.
While it re-iterated the majority of its members were behind the idea of HIPs, it believed some would not be ready for one of the most important parts of the pack at the launch.
Jackie Bennett, head of policy at the CML, said: “This research shows, as we have so often repeated, that lenders are generally not anti-HIP in principle. It is the practicalities, the government’s expectations, and the unintended consequences that cause them concern.”
The CML also said during the interim period after the launch of HIPs, surveyors would struggle to cope with completing both HCR and valuation inspections.
However, it said with the introduction of automated valuation models (AVMs) in the next few years, this would balance out, although it admitted only 40 per cent of valuations would be automated by 2012.
Bennett added: “Even those who are enthusiastic about HIPs do not expect to replace physical inspections with automated valuations on a wholesale basis. Although the market may move more quickly than anyone can anticipate, lenders’ current best estimate is 40 per cent of valuations will be automated five years after HIPs have been in place.”
Jim Gillespie, principal of Independent Financial Services, believed home inspectors would take up the burden of HCRs.
“There are bound to be teething problems but the longer it goes on, the more people will get used to it. I think it’s about time people stopp whinging about the different aspects of HIPs and just start getting on with it.”
