As mentioned before in this column, the CeMAP study manuals produced by the Institute of Financial Services were updated in the summer. All examinations sat on or after September 1 this year are based on the new material.
While the study manuals for papers two and three and the Bridge paper were not altered significantly, there have been a number of changes and students should ensure they are familiar with these, prior to sitting their exams.
One area that has been updated relates to the Government's plan to improve the home-buying process by introducing a seller's pack. There has already been a pilot scheme in Bristol after which the Government announced that legislation requiring all sellers to have a pack ready for potential purchasers would be introduced. It was subsequently announced that this proposal would be shelved for a while. Housing Minister Lord Falconer has, since, announced the Government's renewed intention to introduce this legislation and it's inclusion in the Queen's Speech earlier this month put an end to all speculation.
The UK has one of the slowest, albeit one of the cheapest, home-buying processes in Europe. This is mainly because of the large volume of information that must be gathered before exchanging contracts. The time taken between offer and acceptance and exchange of contracts can also cause sales to fall through because critical information about a property is only discovered at the last minute.
The proposals regarding seller's packs mean that, rather than waiting until a buyer is found before starting the legal work, a seller's pack would be prepared before a property is put on the market. The pack is likely to include copies of:
Replies to standard preliminary enquiries
Building regulations and planning consents and approvals
A draft contract
Replies to local authority searches
A Home Condition Report, based on a professional survey of the property, including an energy-efficiency rating.
For leasehold properties it would also include a copy of the lease, the most recent service charge accounts and receipts, details of the building's insurance policy, regulations made by the landlord or management company as well as the memorandum and articles of the management firm.
Home-buyers will be encouraged to obtain 'in principle' mortgage offers and to undertake preliminary preparations before they make an offer. Lenders, local authorities and service providers will be called upon to adopt service targets so that buyers and sellers receive a fast and efficient service.
Doubts have been expressed as to whether buyers and lenders will be willing to rely on the Home Condition Report in the seller's pack and whether surveyors will be able to cope with the increased workload.
Other changes, such as conveyancing over the internet and the likelihood that both the Land Registry searches and local authority planning information will also at some point be available on the internet, are likely to help lessen the time the process takes. Improvements in the home-buying process have led the Council of Mortgage Lenders to question the Government's intention to legislate in this area and introduce the home seller's pack.
Recent research published by the CML shows that better use of technology by lenders, including online mortgage applications and improvements in credit assessment techniques, are already speeding up the process. Its survey of lenders shows the average time to make a mortgage offer has been cut to 15 days, compared with 22 days when the Government did a review of the home-buying process in 1998.
Electronic conveyancing and the National Land Information Service will bring further improvements by providing online access to title deeds, contracts and other data. The research shows that, within a few years, these developments will lead to a significant narrowing of the gap between accepting an offer and exchanging contracts which took an average of 62 days in 1998.
Concerns about seller's packs include what format will they take and who will use them (lenders, estate agents or both?). And who will end up paying for them?