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Legal Work | Liz Syms Exclusive: When Conveyancing Goes Wrong Uncovered

Legal Work

Legal work


In a recent discussion led by Liz Syms, CEO of Connect for Intermediaries, the focus was on the pitfalls of conveyancing, with a notable case highlighting a significant error – a staggering £200k inadvertently sent to a client instead of the intended lender. The growing concern revolves around the increasing instances where legal proceedings contribute to unwarranted delays in the mortgage application process.

Liz Syms
Liz Syms, CEO and Founder of Connect

Despite lenders’ concerted efforts to optimise their operations through technological advancements for smoother and faster application processes, efficiency is hampered when legal procedures become bottlenecks. The irony arises when, despite streamlined lending processes, the legal stage becomes the bottleneck, undermining the overall expeditious nature of mortgage applications.

While numerous lenders strive to expedite the approval process, the efficacy of their efforts is nullified if legal procedures lag. Notably, the duration of mortgage offer validity varies, with some extending to a mere three months rather than the more conventional six-month period. The ample three-month timeframe should ideally accommodate all necessary legal proceedings; however, many cases necessitate returning to lenders for offer extensions.

The discussion underscores the imperative for a seamless synergy between technological advancements in lending procedures and the legal framework. The repercussions of delayed legal work go beyond inconveniencing applicants; they risk rendering mortgage offers invalid, prompting the need for extensions and complicating an otherwise straightforward process.

As the mortgage industry evolves, addressing and rectifying issues at the intersection of legal and lending processes is paramount for sustained efficiency and client satisfaction.

Legal work | Inadequate expertise

One glaring concern revolves around the deficiency in skills, particularly within specialised fields. Major corporations resort to employing paralegals for case processing, yet the lack of proficiency often generates irrelevant or poorly communicated requests to the client or their solicitor.

In pursuing cost-effectiveness, clients frequently engage solicitors primarily based on pricing considerations, only to find themselves entangled in conveyor belt-like procedures. The aftermath of referral fee payments may leave the solicitor with a mere £150 to cover service costs, which proves manageable under smooth circumstances but becomes untenable when complications arise.

Moreover, not all solicitors demonstrate a ‘broker-friendly’ attitude, meaning they may not automatically engage with the adviser despite the pivotal role the adviser could play in addressing emerging issues. This lack of seamless communication further exacerbates challenges in navigating legal intricacies. Recognising and addressing these inadequacies is imperative to enhance legal processes’ overall efficiency and efficacy.

Legal work | When things take a turn for the worse

Receiving commendations is customary for adept solicitors; however, the very solicitors lauded for their excellence can be overwhelmed, leading to a drastic decline in service quality.

Buy-to-Let Watch Episode 9A recent incident serves as a poignant example, where a portfolio client initially extolled the virtues of a solicitor during the initial property completions. However, this admiration quickly dissipated as the solicitor’s communication and progress dwindled, causing offers to lapse and incurring additional valuation costs.

In another distressing case, a solicitor committed a monumental blunder. The solicitor not only took an agonising three months to process a Buy-to-Let (BTL) remortgage involving the repayment of both a primary and secondary charge, but they also delayed sending the client the expected surplus from the remortgage by a staggering 12 days.

Instead of disbursing the anticipated £70,000, the solicitor erroneously transferred £270,000 to the client. Astonishingly, they had neglected to repay the first charge lender and had failed to request a redemption statement from them.

Unsurprisingly, the new first charge lender, now facing compromised security, expressed profound dissatisfaction, especially considering that this solicitor was their exclusive choice for representation. This unfortunate sequence of events underscores the precarious nature of relying solely on recommendations in the legal realm.

Legal work | Lenders helping out

Traditionally, instances of lenders going above and beyond for clients have been infrequent, but a notable surge in such occurrences is being observed. Numerous brokerages, including ours, increasingly incorporate specialised administrators into their operations to streamline the intricate process from offer to completion.

legal work | Addressing this issue requires proactive measures:  Lenders often complicate matters by imposing intricate requirements onto the standard legal procedures, influenced by their risk tolerance and business motives.

Connect For IntermediariesEncouragingly, financial institutions like UTB and West One are introducing innovative first charge re-mortgage products that streamline the legal work proceedings in-house, akin to second charge completions. This proves beneficial for clients seeking a swift completion guarantee.

Legal Work | In certain situations, brokers must effectively manage their client’s expectations. Especially in cases involving specialised lenders or unique circumstances, the conveyancing process may not align with the client’s initial perceptions, necessitating comprehensive responses to various queries.

Proactively assessing a solicitor’s capacity and familiarity with the proposed mortgage type can prove invaluable in ensuring a smooth process in the long term. Emphasising transparency and clarity in communication becomes paramount for brokers navigating complex scenarios.

We’ve come to the end of our discussion on “Legal Work” until next time.

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