Lifetime ISA Conveyancer Fee

20SmthngSver

My conveyancer has charged me £60 to withdraw my Lifetime ISA funds on my behalf for a house purchase. Are they allowed to do this? Seems a bit unfair as I'm personally not allowed to withdraw the money and they are legally obliged to on my behalf. They never told me there was a fee despite knowing for several months that they would be doing it but it's on my final account statement.

masonic

They are entitled to charge a fee for providing the service (or indeed to refuse to provide the service if they don't want the hassle). You, on the other hand, are entitled to shop around for a conveyancer who offers the best value for your needs.

If the fee is not covered in the contract between you and your conveyancer, and it was not disclosed to you in any communication during the house purchase, then you could make a formal complaint about the charge, and if unsatisfied with the response, take your complaint to the Legal Ombudsman.

20SmthngSver

Thank you. They've known for about 4 months that they would be claiming it on my behalf. I haven't seen anything which said they would charge for it. They are recommended from the developer and I complete next week, too late to shop about.

eskbanker

Seems unlikely to be a coincidence that the fee cap for processing HTB ISAs is £60, so presumably many conveyancers will take the view that it's appropriate to charge the same for LISAs, even though the processes aren't identical.

https://www.helptobuy.gov.uk/help-to-buy-isa/faq/#70a424ea-e1f7-648f-8ce9-ff0000ad17aa

How much will my solicitor or conveyancer charge me to process my government bonus application?

Your solicitor or conveyancer cannot charge more than £50 + VAT to process your bonus application.

As ever, it's not just about calculating a price for a smallish piece of admin work, but spreading the associated overhead costs of compliance, insurance, training, etc, when undertaking regulated activities within formal government schemes.

20SmthngSver

I emailed her saying what I said above, and she said that because it was never included in my original fixed fee quote and because no correspondence ever referred to a fee on their part, she took it off of my final account. Which I think was the right thing to do.

Three people at the law firm who I'd had emails about the Lifetime ISA with never alluded to any charge or pointed me to that GOV link, which it says is for processing claiming the bonus, but a Lifetime ISA already has bonuses paid. All they do is ask for it on my behalf. I'm the one who filled out the withdrawal forms.

masonic

That's a great result. It doesn't surprise me that many solicitors/conveyancers are clueless about the schemes, there is plenty of evidence here to suggest others have had similar experiences.

It's not quite true to say all they have to do is ask for it on your behalf. They also need to complete a declaration similar to the following: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/687168/example_of_model_conveyancer_dec.pdf
Plus all of the overheads mentioned by eskbanker above.

20SmthngSver

The funny thing is that I had to explain what the Lifetime ISA is, how it works and how it's withdrawn from. They didn't know how to do it. They hadto fill out a declaration with a few boxes saying I was claiming for a house in order to be penalty free, but they didn't have to fill out and process an application to the Government like you would for the Help to Buy ISA Bonus, as Lifetime ISA Bonus is paid cash. They just have to say it's for a house and legitimate for withdrawal without penalty.

I couldn't find anything on Lifetime ISA websites saying conveyancers can charge, but it's interesting that they are using the HTB charge as a licence to charge for a Lifetime ISA claim anyway.

The fee should come down over time once their employees know the system and once training costs have been recouped if you like, but life doesn't work like that does it haha. I think £60 is quite excessive and should really be part of the overall fee.