Solicitors & Morgage wont deal with each other ?

bandofbrothers

Good Afternoon All,

Im selling a house.

Most of the steps have been completed.

E.a rang me to say they are sending me and my solicitors updated paperwork, with a new firm of solicitors for the buyer.

Reason : The bank/morgage company will only deal with certain solicitor firms, so the buyer has had to change solicitors.

Can this be normal ?

Why would a big named bank only deal with certain solicitors ?

Yorkie1

Yes it's standard.

The lenders each have their own panel of solicitors which they will deal with. Normally it's based on a certain number of transactions per year, the justification being that they want solicitors who do enough business to understand the lender's forms and requirements.

If a person's solicitor is not on the panel then that causes a hitch, as you have found with your buyer. Now that it's sorted out it shouldn't cause any more problems.

G_M

This is normal.
Many banks have a list of 'approved' solicitors. In particular they frequently refuse to instruct sole practitioners to act for them on the mortgage legals, requiring firms with 2 or more partners.

bandofbrothers

Thanks guys.

At first it just didnt sit right with me.

Being a novice it just seems to me that a solicitor is a solicitor and you should be able to use one of your own choice !

littledisey

Its probably because your buyer's sols is not on the panel of the lender - simple as that and not that uncommon

Perhaps your buyers sol was a sole practitioner a lot of lenders won't deal with a firm unless they have at least 3 partners.

Some want a minimum of 5 partners

Its probably easier for your buyer too switch completely to another solicitor who is on the panel, rather than have to pay another firm to deal with the mortgage aspect, on top of the solicitor dealing with conveyancing

The tip here is to always ask your solicitor if they are on the panel of the lender you think you are going to use. Ask when they quote you and then at least you know

Obviously not something you as the seller have control over, but when you buy again its worth remembering.

bandofbrothers

thanks guys for giving me peace of mind !

FraudBuster

Why would a big named bank only deal with certain solicitors ?

Some reading:

http://www.lawsociety.org.uk/productsandservices/practicenotes/mortgagefraud/2607.article

Richard_Webster

Its probably because your buyer's sols is not on the panel of the lender - simple as that and not that uncommon

Perhaps your buyers sol was a sole practitioner a lot of lenders won't deal with a firm unless they have at least 3 partners.

Some want a minimum of 5 partners

Its probably easier for your buyer too switch completely to another solicitor who is on the panel, rather than have to pay another firm to deal with the mortgage aspect, on top of the solicitor dealing with conveyancing

The tip here is to always ask your solicitor if they are on the panel of the lender you think you are going to use. Ask when they quote you and then at least you know

Obviously not something you as the seller have control over, but when you buy again its worth remembering.

This is true, but a) there will be many sole practitioners (SPs) such as me who can act for Bank of Scotland (inc Halifax, Birmingham Midshires, The Mortgage Business, and Intelligent Finance), Santander (inc A&L), Nationwide BS(including UCB and The Mortgage Works), Lloyds/C&G (inc Scottish Widows Bank), Barclays/Woolwich (inc Standard Life Bank) , RBS/Nat West, Northern Rock, Post Office/Bank of Ireland, Yorkshire Building Society (inc Accord Mortgages), Coventry BS (inc Godiva Mortgages) and Chelsea Building Society.

That's quite a long list and they have to start getting pretty obscure in terms of lenders before a lot of SPs can't act. If you choose a solicitor it is always worth asking if he is on the panel of the lender in question, but equally you should not necessarily believe what a broker says about your chosen solicitor not being able to act for your chosen lender because he is a sole practitioner, as it isn't always right. For instance, most SPs can't act for Bank or Ireland, but I can.

Generally Is suspect that if you find a sole practitioner who does a bit of everything he will not do enough conveyancing to have the minimum number of cases required by certain lenders, so some firms with a number of partners may have been removed from some panels simply because they not do enough conveyancing where say their core business was personal injury work or divorce..

bandofbrothers

Hi.

Just found a downside to the buyer changing solicitors.

My solicitors fee will go up due to them now having to send out new draft contracts etc to the new solicitor.

Im in the wrong job !! lol.