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Law society issues “health warning” for Home Information Packs

New reports published today by the Council of Mortgage Lenders and The Law Society both expressed serious concern to Government over how Home Information Packs (HIPs) will be implemented on time, and the risks of making over-optimistic assumptions about their market impact. The Law Society also warned today that a crucial “health warning” must be carried on all Home Information Packs.

The Council of Mortage lenders delivers three key messages:

Eleven weeks after the 1 June 2007 was announced as the “go live” date for HIPs, the Government has still not published a detailed timetable for their implementation; without this it is difficult to have confidence in the process at all.

The CML is concerned that neither the Government nor the public fully understand how little impact the Home Condition Report (HCR) element of the HIP will initially have on the mortgage process. The HCR will not remove the need for lenders to conduct valuations on each transaction to assess potential levels of lending risk. If the HCR is robust and easily accessible, then over time fewer physical valuations may be needed. But as at the “go live” date, most properties will still need a valuation inspection.

The Government must also consider the possible impact HIPs will have on the housing market. The CML has already identified the likelihood of a “feast and famine” in the flow of properties coming onto the market as a result of HIPs going live. But HIPs might also create other unintentional consequences. There is disappointment that, as yet, the Government has done little to simulate the potential impact of HIPs, they are encouraged to do so urgently.

Kevin Martin, Law Society President, is concerned that, without the warning, there will be serious risks to the consumer: “HIPs contain important legal documents on which professional advice must be obtained. Without appropriate warnings there is a real risk that a buyer could be pressurised into buying a property without independent advice. Buying a home is often the biggest single purchase most people make.”

For the full reports see the following links.

Office of the Deputy Prime Minister (ODPM)

Law Society



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