Solicitors and Interest

dfarry

I have been very happy with my solicitors to be fair...I now have the invoice from for my sale and purchase, I need to get £12K to them asap as we need to exchange and complete next week.If the completion is delayed and the money is held whould I be able to claim interest for the period (I know it wont be much) also they are requesting the mortgage fuinds the day before completion to ensure there are no last minute problem.... again thats a further £135K earning interest for them (That I will be paying)Thanks

RiskAdverse100

As far as your second point is concerned, a lender will not guarantee when monies will arrive with your solicitors if the mortgage monies are requested only for the day of completion. This means that they could arrive very late in the day and too late for you to complete your purchase.

As a result a solicitor with a client involved in a chain who does not request mortgage monies for the day before completion is, in my mind, negligent.

Which would you prefer - the potential nightmare of not being able to complete on the completion date and having to stay in a hotel (possibly for three days if you want to complete on a Friday) with all your possessions in removal vans or £20 in extra mortgage interest?

Having experienced first hand the problems that are caused by a late completion I know which option I would go for!

This issue is perhaps not so important where there is no chain and exchange and completion on the same day is a possibility. However, even in these cases it is essential to request mortgage monies for the day before.

RiskAdverse100

silvercar

The law society sets down set rules on paying interest on clients money based on the length of time and amount ie the shorter the time the higher the amount to be entitled to interest.

Do speak to your solicitor, mine offered me 4% if I had over 20k with him for more than a week.

WestonDave

If your solicitor is drawing down the funds the day before it sounds to me like you have one that is switched on and is doing everything possible to avoid problems on moving day. It really is worth the extra few quid to avoid hassle on moving day - sitting around waiting for keys with removal men wearing long faces is not funny.

I would therefore expect a solicitor like that to return mortgage funds if it is clear completion will be delayed more than the odd day to minimise costs to you - that means they won't really benefit especially as they may well incur a charge to transfer it back that they can't now pass on to you as you have your invoice!

That just leaves the £12k - the rules require them to pay interest on a sum of that magnitude if held for 14 days or more. Below that there is no obligation to do so although if you ask they may do just to avoid bad feeling. For what its worth I would suggest that if there are problems they will be doing more work to sort them out which again they can't charge for as you have your invoice etc (fixed charges normally apply) and as we are talking about £1 a day after tax, I'd be inclined to leave it if as you say you've been happy with their service.

epoman

Rule 24 of the Solicitors Accounts Rules state -

When a solicitor holds money in a general client account for a client
he must account to the client for a sum in lieu of interest

A solicitor is not required to pay a sum in lieu

a. if the amount calculated is 20.00 or less
b. If the solicitor holds a sum of money not exceeding the amount shown in the left hand column below for a time not exceeding the period indicated in the right hand column

Amount Time

1000.00 8 weeks
2000.00 4 weeks
10000.00 2 weeks
20000.00 1 week

Hope this helps