Choose your lawyer carefully when moving home
Mortgage Lenders such as Santander/Abbey have recently made it clear that they are acutely aware of poor conveyancing practices out in the market place, when people move home.
But beware. The sheer competition for work means that it is now possible to pay as little as £99 in headline legal fees and indeed, to pay nothing at all if the proposed sale or purchase fails to complete.
On the face of it this would seem to be a great benefit to the consumer. However, there is a further price to pay in terms of quality when going cheap. After all, you cannot expect your money to work as hard, for a start.
As a result, there now tend to be two camps of conveyancers, the ones who simply shout how ‘cheap’ they are, and those who deliver a complete package of legal efficiency, service and yet still at a reasonable charge.
The choice is yours. Which way will you go?
Cheap, usually means high volume
For some firms wishing to offer conveyancing, and yet still turn a profit despite such low prices, they think their staff have to handle a large number of transactions each, perhaps as many as 200 at any one time. But think about that for a moment – that means that on average, in a 40 hour week a volume conveyancer will be able to spend just 12 minutes per week on each transaction.
With such high volumes of files, quality conveyancing legal staff will not be attracted to the role, and to keep costs down, salaries will be low. As a result, the majority of staff in high volume conveyancing businesses will be unqualified. That means you do not have an actual Solicitor or Legal Executive acting for you. The first disadvantage with cheap conveyancing.
Unlike Solicitors and Legal Executives, unqualified conveyancing staff are not bound by strict professional rules of conduct which do not permit them to act for both sides in a Conveyancing transaction – because it is felt that acting for both sides leads to a conflict of interest, and therefore when a conveyancer acts for both sides, their 'impartial' advice may be suspect. The second disadvantage with cheap conveyancing.
Again, unlike Solicitors and Legal Executives, unqualified staff are not bound by professional rules which require them to reveal the existence of any cash referral fees paid by a Solicitor/Legal Executive to the Estate Agent in return for the Agent directing their customers to them. So if your Agent refers you to a conveyancer, it could be financially motivated, but you will not know, whether or not the conveyancer is any good. The third disadvantage with cheap conveyancing.
Some Estate Agency groups and conveyancing outfits are subsidiary/owned and linked, and so automatic bulk referral of home-moving customers are herded to these conveyancers, and customers are none the wiser, and certainly the customers’ best interests are not paramount. The fourth disadvantage with cheap conveyancing.
Again, to keep costs down, and so turn a profit, you will not normally get to meet your volume conveyancer in person, as correspondence is encouraged to be dealt with over the telephone or through post or e-mail. A tell tale sign is directing you to a website for updates rather than a promise of regular updates by telephone or email. Many people report that this is too impersonal. If the person dealing with the case is quite inexperienced some home movers may worry that they are not getting accurate advice. The fifth disadvantage with cheap conveyancing.
The legal work will be handled by a conveyor belt of staff, rather than one conveyancer throughout. Administration staff will carry out the simpler tasks, such as incoming telephone calls and making outgoing calls to update clients, chase other firms. The more experienced staff will be less in numbers and step in when something has to be checked for complexity. No one individual will handle things throughout. Clients will often speak to many different people and find it difficult to get hold of the person actually dealing with their case. The sixth disadvantage with cheap conveyancing.
Whilst unqualified staff, and administration staff, are not by definition incapable, there are certainly many who are. It is reported that poor quality employees tend to move from firm to firm every couple of years. When a conveyancer makes an error it is often not apparent until the purchaser comes to try and sell the property on, so if the conveyancer keeps moving on, their mistakes don’t catch up with them. Contrast this with a Solicitor or Legal Executive who may be reported to their professional body even after they have left a firm. The seventh disadvantage with cheap conveyancing.
Although an unqualified conveyancer may in fact have gained conveyancing experience (certainly if they are not surrounded with high quality lawyers), they are unlikely to have any knowledge of other areas of law which impact on the house moving process, and which solicitors and legal executives are trained in thoroughly – such as wills, probate, tax dispute resolution, divorce, trusts. Again coming back to the need to always have the technical stuff fed to them – leaving them ignorant if facing a customer wanting instant answers. The eighth disadvantage with cheap conveyancing.
Many conveyancing outfits will charge a very low headline grabbing fee of say £99 or £199, but then in the small print they can do a couple of naughty things. First, they list the extras (usually called ‘disbursements’) that all conveyancers pay out for a seller and purchaser (e.g stamp duty, searches and Land Registry fees) but they add in some extras which they do not pay out to anyone, and they are pure profit. These include:
- ID checks – no firm should pay
- Acting for a mortgage company on a mortgageCharging to repay your mortgage
- Completing a stamp duty formArranging searches
As a result, the quoted £99 or £199 or whatever they quotes is instantly higher than they let on. Any public forum on conveyancers will reveal the inflated bills for the silliest of reasons. As a result, the fee at the end, can often be higher than a traditional high street conveyance where you get an actual Solicitor – see below. The ninth disadvantage with cheap conveyancing.
Nobody likes paying legal fees if the deal does not complete. Maybe you withdraw from a bad survey, poor searches, mortgage refusal, a change in your circumstances, or maybe the other side pull out. If it was through no fault of your own, you would prefer your lawyer not to charge. But clearly they have to, as they have simply done what you asked them to do, and they are professionals in business.
Well, it is quite common to see among the cheaper conveyancing outfits, an offer of ‘No Completion No Fee’. Simple as that. But this offer you would think could bankrupt some firms. But it works well, when the conveyancing outfit does not charge much to start with, there is not a great loss. As a result, such outfits do not invest a lot of time as there remains a chance that your deal could abort and they do not get paid. The tenth disadvantage with cheap conveyancing.
A proper fee usually secures efficiency and service
Should the recommendation of a family member or friend be the deciding factor? Well, again, when a conveyancer makes an error, it is often not apparent until the purchaser comes to try and sell the property on, however personable the conveyancer was at the time of his work.
So, approach any conveyancer by asking, and therefore giving yourself the following 15 advantages:
1. Do you want an actual solicitor Firm, whose bricks and mortar address and reputation can be established, or are you tempted by a cheap headline internet price where you may leave your move to chance, and find it hard to obtain redress if things go wrong?
2. Are you tempted to dismiss a particular conveyancing firm because you think they might be expensive – the bigger they are does not mean they will be expensive, and so you can end up securing their clout and expertise, often for life, and for a surprisingly competitive fee.
3. Try emailing your chosen firm or firms, and see how prompt they are in coming back to you, as that is good test how efficient they will be during your move – it is their chance to impress you and win your business.
4. Does the conveyancing firm just shout how 'cheap' they are, rather than filling you with confidence that they will do an excellent job. The lower their price, the less your money will buy.
5. Avoid national estate agents who may pressure you to use a Firm of solicitors even outside your County! Perhaps to the other end of the Country because they own a share of the solicitors or they are bound by their Head Office to refer out.
6. When contacting a conveyancing firm:
a. do they sound knowledgeable
b. do they listen to you or are they busy in the background
c. do they fill you with confidence
d. do they sound human
e. do they do what they promise (e.g send you a quote)
7. Ask them to confirm that you will receive the same individual conveyancer throughout, not a conveyor belt of people causing confusion, duplication of work and stress for all. Ensure your conveyancer is not called a 'case handler'!
8. Will your conveyancer be legally trained with a good set of years experience behind them, and therefore have the expertise to find solutions to issues that might arise during your move, and potentially hold things up. Or are they junior and soon out of their depth. You might think all conveyancers are legally trained, but as in all service providers, the quality varies wildly. From virtual secretaries performing a legal role, to junior paralegals, to the best trained solicitor or legal executive. Does the conveyancing team made up of solicitors legal executives and senior executives, or is their experience a little vague?
9. Will your conveyancer be part of a Firm with a good reputation and surrounded by competent fellow lawyers. Or are they a small High Street practice, in a small Team possibly the only real conveyance, and therefore with potential for getting overworked and your move slowing down? Or maybe the opposite being too big and have a factory feel?
10. Will your conveyancer be contactable particularly via their personal email, their direct dial telephone number, and their office does not close for lunch, or dead at 5pm.
11. Do they try and sell the red herring of publicised late evening or weekend opening, ye fail to tell you that no conveyancing law firm can transact dealings at that time anyway, as virtually all lawyers are closed then, as are banks.
12. Look for a guarantee of no hidden charges. By this we mean the conveyancer attempting to charge extra for things that form part of what they should be doing anyway – as part of their normal fee e.g you should never agree to a separate charge for:
a. Filling in a stamp duty form
b. Acting for a Lender
c. Repaying a main mortgage
d. Postage and photocopying
e. Submitting normal conveyancing searches or reading the search results
f. Filling in a stamp duty form
13. Do they have their email address on their letterhead so that other lawyers can keep in touch with them as promptly as possible – or are they in the Dark Ages insisting on letters all the time.
14. Do they have a website and does it:
a. demonstrate they are up to date with technology
b. that they are widely trained as a Firm with regular legal news, articles and guides – ideally in the area of house moving
c. that the Firm has 'Lexcel' accreditation and recommendation of 'The Legal 500' – two Kite Marks that efficient and dedicated solicitor Firm's aspire to
d. identify the people in the conveyancing Team, and your own conveyancer with details about them so you can see for yourself who they are and how experienced they are
15. Can they look after your wider legal needs (e.g wills, family matters, disputes, tenancies) providing a complete support and assistance to you.
You can find volume/cheap conveyancing outfits who will get the job done, and you will have no complaints. They can even be better than a traditional high street Solicitor firm, and will generally be much cheaper. However, with all the above disadvantages out in the market place, issues within your home move can be easily and seriously overlooked, misunderstood or simply ignored.
The smart money goes to a Solicitor / Legal executive legal firm who charge a proper yet competitive fee – and make sure your move is smoothly handled through experience, with potential for any long lasting errors, highly reduced.