Property Buyers Delayed By Hsbcs Panel Of Solicitors
A large number of lenders of home loans in the UK have made the decision to use a
panel of approved solicitors in order to handle property transactions but they seem to be lowering the number of firms of solicitors on their panels. Their reasoning behind this change is thatit is due to the increase in mortgage fraud; by using solicitors that are accredited by The Law Societys Conveyancing Quality Scheme and within their approved panel they hope to limit the number cases of mortgage fraud that affect them. However, not only does this reduce the customers choice of solicitor but it is also very constraining and has been causing a range of problems for the genuine home buyer.HSBC, for example, have stipulated that anyone wishing to take out a mortgage with them can only use one of their 43 law firms for all their legal work; anyone wishing to use their own solicitor will be required to pay an extra fee. This has caused delays to many house purchases. One particular first time buyer had to exchange contracts and complete the sale on the same day in order to meet a deadline.
Other homebuyers have reported two to three week delays in their purchase as a result of this arrangement. Many have spoken of their frustration at not being able to speak to the HSBC solicitors directly in order to resolve issues. It leaves buyers very much in the dark and slows down the whole process to such an extent that some sellers have been suspicious that the buyers are delaying the process deliberately.
Even those buyers who have had a positive experience dealing with HSBC overall have agreed that using a panel of solicitors in this way is a bad idea. Dealing with a third party that is not accountable to you means that everything in the whole process is slowed down. Some buyers have had to get their own solicitor involved who the HSBC-approved solicitor would then speak to, adding further to the already expensive process of moving home. Countrywide the law firm - explained that they are only able to discuss the process with HSBC or another solicitor. Quite rightly borrowers point out that when they are paying for the solicitor it is very poor service if the solicitor cannot or will not speak to them directly.
HSBC commented on this new scheme and explained that clients would not be charged for any legal work if the sale of a property falls through. On a more positive note the delays highlight HSBCs competitive large mortgage deals as there is clearly high demand for them from the home buying public. HSBC have stated that they will be adding 33 more solicitors to its panel, so hopefully this problem will be resolved promptly.
This process really could throw things into jeopardy for all involved with securing a competitive mortgage and a new home in the current housing market and could mean the difference between getting that new home or not.
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