UK Finance (formerly Council of Mortgage Lenders (CML)) published a new disclosure form (version 1) on 21 February 2018, replacing version 2.1 of the existing incentive disclosure form. It depends on the terms of the construction agreement. If the construction contract stipulates that the deposit must be held by the builder`s lawyer as an ”agent”, the deposit can be paid to the client at the conclusion of the contract. If the contract states that the deposit will be held as a ”stakeholder” by the builder`s lawyer, the builder`s lawyer will not be allowed to release the deposit until the sale has been concluded to the builder. We note that most builders are not willing to accept a contractual condition for the down payment, which is held on a ”stakeholder” basis. The form has been published for use throughout the UK, so there are various references that do not apply to Northern Ireland. For example, Section 9c of the form, which refers to joint ownership, will never apply to Northern Irish immovable property, as this category of title only applies in England and Wales. Since 1 July 2017, the Council of Mortgage Lenders has been integrated into a new trade association called UK Finance. As part of this transition, a new incentive disclosure form came into effect on August 1, 2018, requiring homebuilders to complete in respect of any property that includes a mortgage from a lender that is to be inhabited or purchased for the first time. The purpose of the form is to provide the lender with all the details regarding all financial aspects of the transaction and other relevant information about the property offered as collateral. The new UK Finance Disclosure of Incentives form is more detailed than its predecessor. In addition to the various issues dealt with in the old CML form, the following questions are now included in the new UK financial form: – The disclosure form is designed to ensure that all financial and other important information related to a transaction is contained in one place. For more information about the context of the form and details on how to fill out the form, see UK Finance Disclosure Form: Background and Frequently Asked Questions.
To this end, the scope of the form has been extended beyond incentives to include information such as property type, construction and land rent. The information provided on the form remains confidential between the parties to the transaction. The disclosure form must be completed by the seller of a newly built property that has not yet been inhabited or purchased for the first time, or an existing property that has not yet been occupied in its current form (p.B a converted property). Can a reservation deposit be withheld if a transaction fails? What happens if the house specifications differ from the brochure? It is typical that 50% of the booking deposit is refunded to a buyer who decides not to proceed, but this is determined on a case-by-case basis, as this depends on the terms of the booking contract signed by the buyer when booking the website. www.ukfinance.org.uk/wp-content/uploads/2018/02/Disclosure-Form-FAQs-February-2018-Final-1.pdf Maeve Corrigan is an attorney in carson McDowell`s real estate department and works for a number of builders/developers. If you need advice regarding residential development, please do not hesitate to contact Maeve on +44 (0) 28 9024 4951. Can down payments to a lawyer be made to a builder or developer? Under the terms of a standard construction contract, a builder is required to build the property in accordance with the plans and specifications submitted and approved by the relevant local authority. It is important not to deviate from the specification without reference to the buyer, as this can be time-consuming and expensive. However, the brochure should include a disclaimer stating that it is for illustrative purposes and should not be considered reliable in terms of dimensions/dimensions. In addition, the construction agreement must not refer to the brochure.
UK Finance is introducing a new disclosure form for the sale of newly built or converted properties. .