At present, if a borrower is considered a risk, lenders contact the borrower’s local tax office, whereas this database will offer lenders a single contact number to verify borrower information.
The scheme, run by HMRC, will widen the Inland Revenue’s intelligence gathering reach to combat tax evasion. However, this is not a bid to address the income verification process proposed by the regulator in the Mortgage Market Review, said the CML.
The previous Labour Government announced plans to set up a formal scheme in its March Budget, but a pilot scheme also convinced lenders the scheme offered real benefits, said the CML.
“Lenders have been systematically targeted by rogue professionals, “said a CML spokesman.
“I don’t think solicitors have been unfairly singled out in the fight against fraud. We are seeking to target a range of professionals through their individual trade bodies, including conveyancers and solicitors.”
Lenders are slimming down their panels, partly because lending volumes are down and also because lenders typically prefer to use partners with whom they have a relationship based on experience instead of implicit trust, he said.
