Solicitor fee/scam?

AdrianC

Katherine_Lewis wrote: »

I completed on selling my property through Premier Property Lawyers 6 days ago and chose the option to have the settlement sent by cheque as they wanted £46.80 to do a BACS transfer. Not only do I think BACS is an unusual way to transfer such a large sum of money but that this is an extortionate charge to do so.

CHAPS is the default way to send large amounts of money - the maximum amount for Faster Payments is £100k, and there's much greater traceability and security on CHAPS.. Others have already pointed out the charges that banks make for CHAPS.

However, 6 days later I am still awaiting the cheque. On calling this morning I am told it was posted first class on the day of completion.

Now you know one of the reasons why they suggested CHAPS. When the cheque does arrive, it's going to be several days after paying in before you can do anything with it.

They cannot tell me if the delivery was recorded in any way without checking with the post room!

That's hardly unreasonable, is it?

If they have no evidence of posting the cheque where do I stand in terms of insisting on a free electronic transfer or holding them liable for lost interest whilst another cheque is sent?

Not a hope. You can get another cheque sent out, of course. BTW, Royal Mail don't regard an item as lost until 10 working days after posting.

Anyway, how much interest are you talking about...? Let's assume the cheque arrived the very next day, and was paid in promptly. It'd be four working days from posting before you earn interest on it, in the absolute best case. Even if you could get the heady heights of 1.5% on it, four days interest on the average property sale price of a tidge under £250k is just about exactly the same as you thought you could be clever and save by not paying for CHAPS. Before claiming for losses, you have a duty to mitigate them...

AnotherJoe

Katherine_Lewis wrote: »

I completed on selling my property through Premier Property Lawyers 6 days ago and chose the option to have the settlement sent by cheque as they wanted £46.80 to do a BACS transfer. Not only do I think BACS is an unusual way to transfer such a large sum of money but that this is an extortionate charge to do so.
However, 6 days later I am still awaiting the cheque. On calling this morning I am told it was posted first class on the day of completion. They cannot tell me if the delivery was recorded in any way without checking with the post room!

Well duh! What else would you expect?

If they have no evidence of posting the cheque Were you expecting photo of a smiling employee dropping it in a post box? where do I stand in terms of insisting on a free electronic transfer or holding them liable for lost interest whilst another cheque is sent?

Nowhere. You asked for a Victorian method of transferring money and are now suffering one of the potential consequences.

Is there any one else out there who has also had the same delay from them suggesting a company policy rather than a postal problem?

Do you know what they are charged to use the CHAPS/ BACS system and make a transaction? If so, please reveal.

If not, on what basis other than complete lack of information do you believe its "extortionate"? Do you often jump to conspiracy theory when things dont go your way? Just think how much staff time you've taken up chasing this bit of paper. That's not what they want any more than you. I'm sure they would be glad to be rid and have this concluded.

MovingForwards

It's a standard BACs payment fee plus VAT on top, all solicitors charge it, it's even included in their fees when buying a house and they transfer the money to the sellers solicitors.

If it was under £100k you could have asked them to pay you by faster payment instead, which is free.

Cheques do take longer to arrive, sometimes the authorised signatories are all out the office when the cheques are due to be signed so they are not dealt with until the next day. If the cheque and covering letter is not together, in the envelope and with the post room in time they miss the post being sent out. That potentially could mean it isn't even on it's way to you until the third day.

Generally, letters are also sent 2nd class, sometimes 1st class depending on what documentation is being sent to you eg a draft will or POA, very rarely recorded /signed for unless it's original documents being returned to you. And no, the solicitors don't personally know when the letters have been sent and do have to check with the post room.

Technically, it will probably be tomorrow or Saturday you receive it.

(Small local firms post is out at 4pm, large city firms is 5pm).

ACG

They probably mean CHAPS which is £30 for many banks from memory. So £15 for admin costs?

You should realise that banks for individuals is very different to banks for business. I have 2 accounts with the same bank, one personal and one business, the business one has far more money in it accruing 0.1% interest and being charged a monthly fee and costs for certain transactions. The personal account has far less money in it earning no interest but everything is free. So they are quite possibly passing on their costs to you.

Also the bank account your money is held in will be a customer account which will very likely be 0% interest, the reason for that is because if it earns interest, they have to pay you the interest accrued and it is not worth the hassle - so there is no benefit to the solicitors for keeping hold of your money, that means it is very unlikely to be a scam.

Just to add, I am not PPLs biggest fan so I have no intentions of defending them but I doubt this is a scam.

Tom99

MovingForwards wrote: »

It's a standard BACs payment fee plus VAT.

CHAPs is what solicitors normally charge £25/£45 for. My experience is that BACs is normally free, the same as a cheque.

System

Thank you all for your contributions. It will go down as one of the annoying facts of financial life as we now live it. PPL and I have managed to get to a satisfactory conclusion today. Hopefully, there will be no further hiccups!

allypally26

‘Also the bank account your money is held in will be a customer account which will very likely be 0% interest, the reason for that is because if it earns interest, they have to pay you the interest accrued and it is not worth the hassle - so there is no benefit to the solicitors for keeping hold of your money, that means it is very unlikely to be a scam’

This hasn’t been the case for several years solicitors no longer have to give the interest to clients any longer.

agrinnall

Tom99 wrote: »

CHAPs is what solicitors normally charge £25/£45 for. My experience is that BACs is normally free, the same as a cheque.

Businesses will have to pay a fee for BACS Direct Credit payments, and it's very likely that there will also be a fee (but smaller than CHAPS) for making a Faster Payment. However, I'd say it's almost certain that what the OP was charged was a CHAPS fee.

davidmcn

agrinnall wrote: »

Businesses will have to pay a fee for BACS Direct Credit payments, and it's very likely that there will also be a fee (but smaller than CHAPS) for making a Faster Payment. However, I'd say it's almost certain that what the OP was charged was a CHAPS fee.

We charge clients nothing for BACS (or cheque), small charge for FP and larger charge for CHAPS.

CHAPS fees charged by banks to larger customers like law firms are fairly modest - the solicitors' charges are largely for their own admin costs.

agrinnall

davidmcn wrote: »

We charge clients nothing for BACS (or cheque), small charge for FP and larger charge for CHAPS.

CHAPS fees charged by banks to larger customers like law firms are fairly modest - the solicitors' charges are largely for their own admin costs.

Are those admin costs significantly different for the different payment types? If not I wonder why you don't pass on those costs for BACS/cheque but do for other payments - unless of course you buck the trend and only pass on what you are charged by your bank (although that still leaves some confusion about BACS, as the bank I worked for certainly charged businesses for that).