House purchase/sale mortgate/solicitor issues

progressive_uk

Any advice gratefully received!

Locale: Oxfordshire, England

At the beginning of June 2013 I sold my present house. I shortly thereafter had an offer accepted on a new property. The solicitors who I originally bought my present home with in 2009 were instructed as to both sale & purchase. I have a mortgage with an unnamed building society, and have done since original purchase. I needed a small amount of additional lending, which was approved in principle in a face-face meeting on 22 June. Several details were exchanged at this meeting, including the memorandum of sale for the new property, which obviously included the details of my solicitor which were typed into the B.S's system. Mortgage application went off later that week

I have been told late today that the solicitor is not on my B.S's panel of solicitors. They were somewhat apologetic for it not being picked up earlier.

As far as I can see my course of action should be as follows:

1. Complete my sale with existing solicitors, as we are now close to exchange and I have always found their work & communication to be very good. I have also already put down an initial £350 for disbursements. There legal fees for sale are ~£450.
2. Get a new solicitor to act in the purchase, obviously checking they are on the panel!
3. Complain to my B.S. and demand some level of compensation for an error that at minimum has cost me time and inconvenience, and probably money as my quote for purchase from my present solicitors was very good.

Anything I've missed? Any advice?

<sebb>

4. Ask your solicitor to apply to be on your mortgage lenders panel. Happened to me and that's what I did. It was very straightforward.

Maidenover

Excuse my ignorance but I was totally unaware that you have to use the BS solicitors - is that correct? Are they saying they wont lend you the extra money if you don't use one of theirs? I would be furious about this and wonder if you can use the fact they failed to tell you at the time to get out of it. There must be an Ombudsman you can ask or maybe Citizens advice. Is there any way you can get the additional money you need elsewhere?
Sorry I'm not being very helpful :-(

progressive_uk

<sebb> wrote: »

4. Ask your solicitor to apply to be on your mortgage lenders panel. Happened to me and that's what I did. It was very straightforward.

One would have thought this was possible, and I will double check in the morning, however I think it probably isn't.

They were obviously on the panel when I bought the property (same solicitor/B.S.), and some reference was made to them being removed for some reason, so not sure what that side of the story is, and probably won't be told anyway.

Thanks for the advice - I will definitely give it a go.

progressive_uk

Maidenover wrote: »

Excuse my ignorance but I was totally unaware that you have to use the BS solicitors - is that correct? Are they saying they wont lend you the extra money if you don't use one of theirs? I would be furious about this and wonder if you can use the fact they failed to tell you at the time to get out of it. There must be an Ombudsman you can ask or maybe Citizens advice. Is there any way you can get the additional money you need elsewhere?
Sorry I'm not being very helpful :-(

Thank you for the questions anyway as its helpful for me to clarify anything I missed.

Original lending is still within a fixed term, so getout costs will be quite high (over 4K). I've also already paid for £315 in valuation/processing to the B.S. Even if I could avoid the additional borrowing issue, I still need a solicitor to do the porting work for the mortgage, so a solicitor will be needed for that either way.

WestonDave

Maidenover wrote: »

Excuse my ignorance but I was totally unaware that you have to use the BS solicitors - is that correct? Are they saying they wont lend you the extra money if you don't use one of theirs? I would be furious about this and wonder if you can use the fact they failed to tell you at the time to get out of it. There must be an Ombudsman you can ask or maybe Citizens advice. Is there any way you can get the additional money you need elsewhere?
Sorry I'm not being very helpful :-(

When you buy a house subject to a mortgage as in this case there is work done for you to complete the purchase but also work done on behalf of the lender to ensure there is a charge over the property and in effect that they can recover the property if the loan isn't repaid. The lender is perfectly entitled to choose who they want to do this, and in fact in normal circumstances the most common arrangement whereby the same solicitor acts for both purchaser and lender would be deemed to be a conflict of interest. Most lenders have criteria as to who they will allow to do their mortgage work - HSBC recently went as far as limiting it to a very small number of solicitors managed via Countrywide but this got canned when too many people complained. In most cases all the lender wants to know is that the solicitor is experienced in property work (CQS accreditation is a good start), has proper indemnity insurance in place and a few other checks so its not so arduous to get added to the panel even at short notice - it can normally be done within the transaction. It may be in this case there is something unique to a small lender or a particular firm which has prevented that.

WestonDave

Its possible they've just been pruned off the list due to not acting on one of the lenders mortgages for a while - some lenders do review their lists and drop firms that haven't been involved for a while. Its not necessarily sinister.

<sebb>

progressive_uk wrote: »

One would have thought this was possible, and I will double check in the morning, however I think it probably isn't.

They were obviously on the panel when I bought the property (same solicitor/B.S.), and some reference was made to them being removed for some reason, so not sure what that side of the story is, and probably won't be told anyway.

Thanks for the advice - I will definitely give it a go.

Similar to me. I had used the solicitors three years previously and were on the panel ant the time. Turns out they had a name change and had to reapply to all lenders. They hadn't gotten round to mine yet.

I say it was straightforward, actually I had to do some minor chasing. Solicitor said they had filled in the forms, mortgage company said they hadn't received them etc. after banging some heads together it got sorted in a day.

ValHaller

Maidenover wrote: »

Excuse my ignorance but I was totally unaware that you have to use the BS solicitors - is that correct? Are they saying they wont lend you the extra money if you don't use one of theirs? I would be furious about this and wonder if you can use the fact they failed to tell you at the time to get out of it. There must be an Ombudsman you can ask or maybe Citizens advice. Is there any way you can get the additional money you need elsewhere?
Sorry I'm not being very helpful :-(

The issue is that the lender is represented by a solicitor. Conventionally it is the buyer's solicitor who undertakes this role, but it does not have to be. There is no point in being furious about the lender wanting their choice of solicitor - this solicitor represents their interests and who is to tell the lender that they are wrong?

What can sometimes be done is to have a panel solicitor either conduct the mortgage lender part of the work or check over the file. This may be a good option if the deal is near exchange.

In respect of the options you list, progressive,

1 is only viable if a panel solicitor at least checks over the file
2. will delay the transaction
3. it is unlikely you will get compo as the lender is entitled to use their own solicitor

progressive_uk

ValHaller wrote: »

In respect of the options you list, progressive,

1 is only viable if a panel solicitor at least checks over the file
2. will delay the transaction
3. it is unlikely you will get compo as the lender is entitled to use their own solicitor

So it is not an option to have two separate solicitors, one acting in the sale, and one acting in the purchase? Or if I did, the present solicitors acting in the sale would still need their work checked?

ValHaller

progressive_uk wrote: »

So it is not an option to have two separate solicitors, one acting in the sale, and one acting in the purchase? Or if I did, the present solicitors acting in the sale would still need their work checked?

Sorry, misunderstood. Scrap what I said about 1 - this will work but adds an unnecessary link in the chain for exchange and completion days - although it won't much matter aside from that.

Personally, I would be trying to get the mortgage overseen by a panel solicitor - ideally recommended by your current solicitor.