From the beginning of September lenders will require builders or developers of any newly built, converted or renovated property to complete a new 'disclosure of incentives' form where they will have to declare buyers incentives under new rules designed to combat mortgage scams.

CML said lenders feared they were not always told about discounts and incentives negotiated by buyers, causing them to offer mortgages higher than the true price paid.

In September, the Royal Institution of Chartered Surveyors will be amending its guidance to members to reinforce the requirement to disclose incentives to lenders.

The Home Builders' Federation and Homes for Scotland have recently reinforced their own codes of conduct to encourage greater transparency about discounts and other incentives. 
A number of major builders are also taking their own steps to address the issue.

The CML's director general Michael Coogan said:
"We are introducing these measures to help sustain confidence in the market for newly-built property. Lenders need to know about discounts and other incentives so they can be sure that the decision to offer a mortgage is based on a reliable valuation of the property. The new measures will provide additional security and safeguards for borrowers, as well as lenders.

"We welcome the support of RICS and house-builders in implementing this solution. Responsible builders and developers understand that lenders must have confidence in the valuation process. They are supporting our initiative because they understand that, in making these changes, we will reinforce confidence in the new-build market."