The Council of Mortgage Lenders (CML) was merged into UK Finance in July 2017. UK Finance represents all the leading high street lenders. In February 2018, UK Finance launched a new Disclosure Form. The Disclosure Form has to be provided by developers to the lender’s valuer on every transaction involving newly built and renovated residential dwelling.

The purpose of the Disclosure Form is to provide all parties (but particularly the lender’s valuer) with key information about the transaction in a single format. Any changes to the Disclosure Form must be provided to the valuer as soon as practically possible - as any changes could have an impact on the valuation/mortgage offer. This could have a knock on effect of delaying the transaction and in today’s market when everything is required on a tight timeline any delays are unwelcome.

July 2018 is the deadline for phasing out the previous CML Disclosure of Incentives (CML DOIF) at which time it will no longer be accepted by mortgage valuers.

The development of the new Disclosure Form (DF) will provide a wider scope of key information to the benefit of all parties involved. The key financials and other details of the property will enable a more accurate and reliable valuation to be carried out since the valuer will have a complete understanding of the financial impacts of the transaction; and able to assess a comparison, for example, between initial discounts and incentives against the ongoing running costs (by way of services charges etc).

The new form is much more detailed and the major changes are:

• A plan must be supplied with the form to the valuer. The most effective plan will be the conveyance or lease plan, showing the layout of the property (Q2)
• Reason for any discount to be given (Q2b)
• Type of construction (Q2c)
• New home warranty eg NHBC details to be inserted (Q2d)
• Flats/apartments must be expanded (Q3b)
• Tenure mix (Q3c)
• Developer loans to be disclosed (Q4c)
• All financial incentives to be disclosed (these include mortgage subsidies and cash backs) (Q7)
• Full details about part exchanged properties to be made available (Q8)
• Tenure, length of lease and service charges to be disclosed (Q9).
  
  

Key deadlines include:

• the form must be completed and issued to the valuer before the valuation;
• the valuation cannot be conducted without it;
• delay in completing the form will result in a delay for the release of the mortgage offer; and
• the DF must also be issued to the seller’s solicitors seven days before exchange for onward submission to their lender.