You can trust me - I'm a lawyer. Honest, Guv.
Some of the promises we're seeing being made by companies selling legal services would make Arthur Daley blush. Last week, a firm promising "no-sale no-fee" forgot to mention that the client has to buy insurance to ensure that they don't pay anything if the sale aborts - this insurance costs about £100. Obviously, "no fee" is only relevant when used in conjunction with the word "legal". Another favourite trick we've seen is disguising fee-earning work as a disbursement, such as completing Stamp Duty Land Tax forms. Another client was quoted £600 for the work, and ended up paying £1600 (for unexpected items). However, we adam-and-eve that agents are steering clients away from the cut-and-shunt merchants which can only be good wooden pews. (Click here for a translator to help you communicate with such firms)
Lenders help to slow the housing market
With lenders determined to eliminate mortgage fraud, some are reducing the number of firms they will allow to represent them. HSBC have taken a radical approach and reduced the number to about 40. The lender has told our clients that if they want to use their own solicitors that are not on their panel, that this will slow down the buying process, and could cost them more. Other lenders have indicated that they will follow this lead by reducing the number of firms that will represent them. It is unclear how this reduction in choice, increase in fees and the introduction of further delays will benefit the housing market.
Buyers impacted by searches
There are some new challenges for people looking to buy properties in London, primarily from several local authorities that are now taking over 6 weeks to return searches, and the new issues that are raised by the building of the HS2 trainline. To head off potential problems, over the past 6 months, we have been carrying out searches specifically to check whether the line will affect the property in question. Over the past few years, buyers looking for a London property had to contend with concerns over the CrossRail project, but now, it's delays in searches and the impact of the new rail line that they need to consider as well when looking at purchase decisions and timescales.
The Partnership introduces unique online assistance
As part of the development that is well underway with our revamped website, we are providing new online services, including a unique guide for first-time-buyers to help explain the conveyancing process more effectively. We will also be offering an online-chat service where clients can talk to us online at any time, in addition to our Skype offering, due in early Spring.
Tuesday 31 January 2012
Sunday 22 January 2012
The Partnership raises concern about lenders abusing their position
For Immediate Release
Guildford, Surrey – 22nd January 2012 – The Partnership has evidence that banks and building societies are misleading their mortgage clients over legal representation and costs, with the result that one of their clients has instructed the financial ombudsman to take direct action.
Traditionally, solicitors represented both the buyer and the mortgage lender in the purchase of a property. However, lenders, concerned about the increasing levels of mortgage fraud, have recently started to dictate who may represent them, by setting up panels of “authorised” firms.
This change has lead to warnings that consumer choice was being restricted, but The Partnership now has specific evidence where clients are being penalised due to their selection of mortgage provider. These include a bank misleading a client over costs, another forcing a client to use an expensive London solicitor, and a nationalised lender refusing to disclose their charges.
Peter Ambrose, Director of The Partnership, is extremely concerned; “We do not mind lenders dictating who may represent them - indeed, we would prefer that ALL lenders used their own chosen law firms to represent themselves as it removes a potential conflict of interest that we currently face.
However, our evidence shows that lenders are abusing their position, to the detriment of their clients. After approving a mortgage, a bank tried to allocate a conveyancer directly to one of our clients for a cost of £600. When our client explained that he already had a solicitor, he was told this fee would apply anyway. As the correct figure was £160, it suggests that the bank was quoting the full conveyancing fee in what appears to be an attempt to encourage our client to use their chosen provider.
We had been acting for a lender with their authority, but two days before exchange, they withdrew this authority and told our client to either use another law firm for the entire transaction, or to use one of their chosen firms to represent them for a fee of nearly £1000. Given the time pressure, our client had no choice but to use the firm that was representing the lender, resulting in a doubling of their fees.”
Given the much publicised pressure on banks to act fairly, we are disappointed that some do not appear to be acting in the best interests of their clients. It is particularly galling when a client must revert to the financial ombudsman because a nationalised firm refuses to disclose the fees that their chosen law firm will be charging. This abuse of power must be stopped, and we are delighted that the ombudsman has acted quickly but are very concerned about the approach some lenders are taking.”
Notes to Editors
The Partnership is a new breed of law firm, employing London-trained solicitors, specialising in fast and efficient transactions. For more information go to www.thepartnershiplimited.com. A PDF version of this press release is available.
Media enquiries
Peter Ambrose, The Partnership – 01483 579978 or email info@thepartnershiplimited.com
Guildford, Surrey – 22nd January 2012 – The Partnership has evidence that banks and building societies are misleading their mortgage clients over legal representation and costs, with the result that one of their clients has instructed the financial ombudsman to take direct action.
Traditionally, solicitors represented both the buyer and the mortgage lender in the purchase of a property. However, lenders, concerned about the increasing levels of mortgage fraud, have recently started to dictate who may represent them, by setting up panels of “authorised” firms.
This change has lead to warnings that consumer choice was being restricted, but The Partnership now has specific evidence where clients are being penalised due to their selection of mortgage provider. These include a bank misleading a client over costs, another forcing a client to use an expensive London solicitor, and a nationalised lender refusing to disclose their charges.
Peter Ambrose, Director of The Partnership, is extremely concerned; “We do not mind lenders dictating who may represent them - indeed, we would prefer that ALL lenders used their own chosen law firms to represent themselves as it removes a potential conflict of interest that we currently face.
However, our evidence shows that lenders are abusing their position, to the detriment of their clients. After approving a mortgage, a bank tried to allocate a conveyancer directly to one of our clients for a cost of £600. When our client explained that he already had a solicitor, he was told this fee would apply anyway. As the correct figure was £160, it suggests that the bank was quoting the full conveyancing fee in what appears to be an attempt to encourage our client to use their chosen provider.
We had been acting for a lender with their authority, but two days before exchange, they withdrew this authority and told our client to either use another law firm for the entire transaction, or to use one of their chosen firms to represent them for a fee of nearly £1000. Given the time pressure, our client had no choice but to use the firm that was representing the lender, resulting in a doubling of their fees.”
Given the much publicised pressure on banks to act fairly, we are disappointed that some do not appear to be acting in the best interests of their clients. It is particularly galling when a client must revert to the financial ombudsman because a nationalised firm refuses to disclose the fees that their chosen law firm will be charging. This abuse of power must be stopped, and we are delighted that the ombudsman has acted quickly but are very concerned about the approach some lenders are taking.”
Notes to Editors
The Partnership is a new breed of law firm, employing London-trained solicitors, specialising in fast and efficient transactions. For more information go to www.thepartnershiplimited.com. A PDF version of this press release is available.
Media enquiries
Peter Ambrose, The Partnership – 01483 579978 or email info@thepartnershiplimited.com
Tuesday 17 January 2012
Brave new world or just the emperor's new clothes?
Over the past week we've discovered that the brave new world promised by the breaking of the monopoly on legal services is not so brave or new after all, with firms offering traditional services but just with new brochures.
On October 6th 2011, the Legal Services Act enabled non-lawyers to own law firms. This change promised innovative new offerings from modern firms and it is widely expected that residential conveyancing would be the first service to experience this change.
However, it appears that rather than innovation, its more a lack of imagination that has come to the fore, with several new offerings merely re-packaging existing services under a new name.
In the first instance, a major agency chain is promising a new fast conveyancing service as part of their selling process. The brochures are covered with pictures of happy smiling house buyers, delighted with their 24 hour access to case information and friendly solicitors getting their deals done in days. The disappointing reality merely just another name for a tired old legal panel, paying local solicitors a fraction of the fee to carry out the work. Nothing new beyond the name here (and of course the disatisfaction from the same lawyers).
Another firm is offering an interesting model with low costs and high introductory fees to agents. Again, promising 24 hour access to dedicated staff; this time it's just another name for a high-volume conveyancing factory, known to have high fall-through rates and slow turnaround times.
Its extremely disappointing to see this lack of commitment at first hand - it seems that innovation has yet to come to the legal services market and what we see are merely false starts on the road to innovation.
Here's an idea for companies looking to offer legal services. Instead of pimping out non-lawyers and offering generic support email addresses as a communication substitute why not take the plunge and actually employ staff and invest in systems to provide the service directly.
Or is that a step too far in this brave new world?
On October 6th 2011, the Legal Services Act enabled non-lawyers to own law firms. This change promised innovative new offerings from modern firms and it is widely expected that residential conveyancing would be the first service to experience this change.
However, it appears that rather than innovation, its more a lack of imagination that has come to the fore, with several new offerings merely re-packaging existing services under a new name.
In the first instance, a major agency chain is promising a new fast conveyancing service as part of their selling process. The brochures are covered with pictures of happy smiling house buyers, delighted with their 24 hour access to case information and friendly solicitors getting their deals done in days. The disappointing reality merely just another name for a tired old legal panel, paying local solicitors a fraction of the fee to carry out the work. Nothing new beyond the name here (and of course the disatisfaction from the same lawyers).
Another firm is offering an interesting model with low costs and high introductory fees to agents. Again, promising 24 hour access to dedicated staff; this time it's just another name for a high-volume conveyancing factory, known to have high fall-through rates and slow turnaround times.
Its extremely disappointing to see this lack of commitment at first hand - it seems that innovation has yet to come to the legal services market and what we see are merely false starts on the road to innovation.
Here's an idea for companies looking to offer legal services. Instead of pimping out non-lawyers and offering generic support email addresses as a communication substitute why not take the plunge and actually employ staff and invest in systems to provide the service directly.
Or is that a step too far in this brave new world?
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