Home Information Pack -"HIP"

Home Information Packs are needed for all properties

(from 14th December 2007).

Option 1 : No Sale No fee - £499+VAT * No credit checks or upfront fees. Fees are paid from completion of funds when property is sold. In order to benefit from this exclusive offer, the client must also use our nominated solicitor for their sale and any related purchase transactions. Option 2 : Standard HIP - £299+VAT * Fee must be paid at the start of the transaction by credit/debit card. The client must also use our nominated solicitor for their sale and any related purchase transactions. Option 3 : HIP ONLY - £399 + VAT * Fee must be paid at the start of the transaction by credit/debit card. You can use any solicitor of your choice.   * All prices exlude dispursements

We can provide these packs on a NO SALE, NO FEE basis.  So you can put your house on the market without worrying about wasted money should your sale fall through.

The Government has made it law that as from 1st August 2007, should homeowners intend to sell their properties, they will have to arrange for a Home Information Pack (HIP) to be prepared and available for inspection by anyone interested in buying their property.  Commencing with four bedroom or more and then for three-bedroom or more properties and finally all remaining properties.   Although there are some exceptions (such as selling privately to family members or if the property is tenanted), these regulations will affect you when you come to sell your house or flat.

 What is in the Home Information Pack?

Some documents (termed “required” ) must be included. Some are “authorised” meaning that they can be included but don’t have to be.

The required documents are:

• An index (i.e. a list of the contents of the pack)
• An Energy Performance Certificate
• A sale statement (summarising terms of sale)
• Standard searches (i.e. local authority enquiries and a drainage and water search)
• Evidence of title
• Where appropriate, leasehold information (including a copy of the lease, information on service charges and insurance)
• Where appropriate, commonhold information (including a copy of the commonhold community statement)
• Where appropriate, a New Homes Warranty
• Where appropriate, a report on a home that is not physically complete

The authorised documents include:

• A Home Condition Report
• Guarantees and warranties
• Other searches relevant to the particular area
• A Home Use Form
• A Home Contents Form
• Extra title information (e.g. copy indemnity policies)
• A legal summary
•  

What is an Energy Performance Certificate?

Energy Performance Certificates will give home buyers and sellers A to G ratings for their home’s energy efficiency to help cut carbon emissions and fuel bills. This is designed to help homeowners reduce the environmental impact of their homes.  Energy Performance Certificates will become mandatory as part of Home Information Packs from 1st August 2007 (Only those professionals who are fully qualified and certificated will be allowed to prepare Energy Performance Certificates.)

Do you have to wait for all Home Information Pack components to be completed before marketing a property?

A home can only be put up for sale if a pack has been prepared. Providing reasonable attempts have been taken, in certain circumstances the property can be marketed with an incomplete Pack – but these will be exceptions only.

How long will the complete Pack be valid for?

The Home Information Pack is valid whilst the home is continuously marketed for sale and the Regulations allow for a period where the property might be taken off the market whilst, for example, it is under offer or to allow a seller to change agents.  The main time-sensitive items in the HIP are the local searches and drainage searches.  Evidence of title and standard searches should be no more than three months old at the commencement of marketing. The Energy Performance Certificate should not be more than twelve months old at the time when the property is first marketed.  The majority of sales complete within six months under the current process and it is hoped that Home Information Packs will shorten the time between offer, acceptance and exchange of contracts.

Who is liable for the accuracy of the contents?

The provider is liable for any misinformation within the pack. For example, search provider for searches, Home Inspectors for Home Condition Reports, seller for property information form, etc.

Once a Home Information Pack is produced, who has the responsibility for ‘policing’ the expiry dates, and re-producing the expired components?

None of the HIP components will have an expiry date but certain time-sensitive parts of the Pack might need to be updated if the property is taken off the market and then put back on again.

Who can see the sellers Home Information Pack?

Access to a Home Information Pack is available to genuine prospective buyers, except where a seller has stipulated that they would not be prepared to sell to that person.

Where will the original Pack be stored?

The person responsible for marketing the property must keep a pack in his or her possession or under their control. The original documents may remain in the possession of the seller or their conveyancer.

Can you charge for copies of the Pack?

Yes - a reasonable charge can be made for making, and if requested, sending a paper copy.  This does not apply for providing copies in electronic form. 

What are the penalties for marketing a property without a Home Information Pack?

Trading Standards Officers are responsible for enforcement and will have a number of options.  These range between providing help and guidance, to the serving of a £200 penalty charge notice which can be reissued for ongoing non-compliance.

What will the Home Condition Report cover?

The Home Condition Report will be an objective report on the condition of the property that can be relied upon by buyer, seller and lender. The report will be in a standard format, prepared in accordance with standards set by the Department for Communities and Local Government. It will cover matters of importance to a buyer - the general condition of the property taking account of its age, how energy efficient the home is and any defects or other matters requiring attention.

What are the advantages of including a Home Condition Report in the Home Information Pack?

Late availability of home condition information frequently causes problems. Government research suggests that 43% of failed transactions do so as a result of problems revealed by a valuation inspection or condition survey, after terms have been agreed. The cost to consumers can be around £1,000 per transaction. Moreover, even where transactions do not fail, they are often delayed whilst renegotiations take place. In a chain situation the effects go well beyond those directly involved. That is why the Government wants to ensure that any problems are identified up front and would advise that sellers ‘top up' their Home Information Pack to include a Home Condition Report.

Will mortgage lenders accept the Home Condition Report, or will further cost be incurred for additional documentation to be commissioned?

Discussions with the Financial Services Authority (FSA) have not revealed problems with using the Home Condition Report as part of the mortgage valuation assessment. The valuation methodology chosen by the lender will depend on the circumstances of each case, so at this stage every individual lender will have to make their own decision on whether they require a survey.

How long is a Home Condition Report valid for?

There is no stated period of validity for the Home Condition Report as this provides a ‘snapshot’ of the condition of the home at the time the report was prepared. The condition of a home does not normally change quickly unless there is an intervening event such as a fire or a flood. The majority of sales complete within six months under the current process and the Government expects the Home Information Packs to shorten the time between offer, acceptance and exchange of contracts.