The CLC expressed some interesting views concerning conveyancing panels
The webinar hosted by CLC chair Anna Bradley but it was it’s Sheila Kumar as its Chief Executive Sheila Kumar who had the most to say about lender panels.
Applying get onto or removal from lenders panels is a concern for every conveyancing professional.
Ms Kumar acknowledged having spoken to very many practices who have lost work because of a lenders decision, not to include them on their panel and clearly that’s something and therefore the CLC is taking the issue very seriously.
The CLC took the opportunity to make it clear about what the role of the CLC is in this, because as a regulatory body rather than as a representative body.
Kumar asked delegated to get in touch with any issues as the CLC want make sure that there are no issues that are with lenders at the moment, which often may just be misinformation that may prevent licensed conveyancers getting into panels. She wnt on to say “..where we think that there are, perhaps, some systemic issues, perhaps some overhang from previous practices, we are dealing with those things. We’re in strong conversations with the Council of Mortgage Lenders, the Building Societies Association, and indeed lenders specifically to raise awareness of what licensed conveyances are, but also to address some of the issues that sometimes have existed. And those sometimes just fall into the category of people being asked to provide a solicitor’s role number which is clearly not something that a licensed conveyancer was ever able to do”
The CLC sought to clarify that as a regulator what they can not do is to intervene on specific issues that are, in a sense, the, the, more of the representative side for any particular practices having a difficulty.
The Law Society is currently developing an online conveyancing portal to streamline the process and improve communication between solicitors, conveyancers, clients and stakeholders including Land Registry and HMRC. It is expected to go live this year.
The Law Society is seeking to identify a group of subject matter experts to advise on the incorporation of practitioner best practice processes into the development of the conveyancing portal from early design phases, through testing to the launch of the product, and also post-launch.
The adverts explains that the job represents an opportunity to be right at the “heart” of this new service for conveyancers. The importance of practitioner input in the design and build phase cannot be over-estimated. The intention is that this portal should be a resource for all professionals involved in residential property matters. At a later stage when addressing service for clients the Law Society will also seek to involve consumers and other stakeholders.
To apply click here
C.Hoare and Co has become the 117th member of the CML but as yet has not published any CML Handbook requirements.
Founded in 1672, C. Hoare & Co is the UK’s oldest, independently owned private bank. Its board comprises seven shareholding partners, all descendants of the bank’s founder, along with five other directors.
The CML have now published a note on the CML Handbook landing page advising that on 26th April 2014, new mortgage market rules come into force.
The CML have advised that there may be some impacts on individual conveyancing transactions as a result.
The three main points to be aware of are as follows:
1. Where no formal mortgage offer has been issued, in effect where the application has not been fully underwritten by the lender, as at 26th April 2014 (e.g., the case has only been given an Agreement In Principle/Decision In Principle by the lender) then the case will have to be underwritten using the new responsible lending rules ( some lenders such as Virgin Money may have already implemented these rules prior to formal MMR implementation). Theoretically this could delay the issuing of offers as the the case would have to be looked at through the new lending rules.
2. Where a formal mortgage offer has been issued as at 26th April 2014, i.e. the application has been fully underwritten, the case can proceed to completion provided no material change occurs in relation to affordability between offer and completion. The case proceeds as normal.
3. Should a material change occur in relation to affordability between mortgage offer and completion the lender will have to reassess the case using the new MMR responsible lending rules and decide if they wish to continue with the offer, amend it or withdraw it. There are some specific instances of what constitutes a material change in the MMR rules, however, outside of these; lenders will have differing policies about what constitutes a material change in terms of their lending policies.
Lenders will be managing their pipeline cases in different ways and will have individual requirements/materiality thresholds in relation to processing changes to mortgage applications.
As well as the above, there will be a more detailed and prescribed advice process for lenders when advising potential borrowers. Under the new rules, the majority of sales will be advised – in particular, interactive sales where there is a spoken or interactive dialogue with the consumer during the sale will be deemed to be advised.
It remains to be seen if there will be any CML Part 2 changes in light of the new MMR rules.
Further information can be found here.
In addressing various concerns voiced by solicitors about the Lender Exchange, Decision First director Justin Parkinson has clarified the destination between the Lender Exchange (soon to be adopted by Llyods Banking Group) and CQS.
Parkinson admitted that CQS had been “a huge step in the right direction” but that it did not cover non-SRA regulated firms. By this he means licensed conveyancers regulated by the CLC.
He added: “Some lenders also say CQS doesn’t go far enough, so some CQS firms don’t make it onto panels.”
Parkinson did not delve into where he, or lender such as Birmingham Midshires believe that there are deficiencies in CQS. Furthermore, he confirmed that criteria to be on panels such as the Birmingham Midshires Conveyancing panel are unlikely to be changed as a result of the lender exchange portal.
“Lender Exchange will not change anything about the decisions that lenders make today on panel appointments. Lenders will make their decisions independently of each other and Lender Exchange will not facilitate the sharing of these decisions – each lender’s view of the system and firms on their panel is theirs and theirs alone,” Parkinson said.
The creators of the Lender Exchange, the platform behind the proposed Halifax Conveyancing Panel Portal have declared that the technology “will benefit law firms”,
In response to vocalised and ongoing suspicion on the part of property solicitors that the new scheme has been set up solely in the interest of lenders, Decision First have said “There is no doubt that lenders will see benefits in their panel management activities, but what we’re launching is more about delivering benefits to law firms than to lenders,”.
Talking to Solicitors Journal, Decision First director Justin Parkinson said that the original launch date of 31 March had been pushed back by four weeks to late April as the company was still testing processes and migrating data held by law firms on the Santander conveyancing panel, one of the main three lenders that have signed up to the scheme at launch. No dates have yet been announced for the Halifax (or Lloyds group) portal.
Commenting on the Budget, BSA Chief Executive, Robin Fieth said:
“The BSA has campaigned for years for the reformation of the ISA rules. Finally the Chancellor has listened and we are delighted that he has done exactly what we have been calling for: Increased the limit; delivered a single allowance which no longer penalises savers who want to invest in cash and allowed the transfer of funds in either direction between cash and stocks & shares ISAs. This will benefit many mid and lower income savers, especially those nearing retirement. We are also pleased that he has accepted the need to reform the 10p tax rate on savings, this new 0% rate must be simple for savers to claim.
“We also welcome the Chancellor’s proposals to boost house building, particularly the extension of Help to Buy: equity loan and the support for self-builders. Care is needed here that incoming regulation from Europe does not undo this welcome boost for self-build.
“Once again, however, the opportunity to reform the slab structure of Stamp Duty, which distorts the housing market has been missed. Changes are already planned to move to a progressive stamp duty land tax in Scotland in 2015 and we’d encourage the Chancellor to ensure that England does not trail behind.”
The High Court has now provided judgment where a similar clause to that in Mortgage Express v Sawali  was contained in the lender’s mortgage conditions, rather than expressly signed as a declaration in the mortgage application.
In the recent case of The Mortgage Business Plc v Oliver & Co the lender had requested a number of conveyancing files from the solicitors who had acted on a joint retainer on behalf of the lender and the borrower.
The solicitors for the defendant refused to provide their complete conveyancing files relying in part on a Law Society Guidance Note published in December 2011. This warned that such consent by the borrower may not be “informed consent”. This meant that the solicitors were at risk of breaching confidentiality and/or privilege obligations without further clarification from the borrower. Additionally, if the solicitor was no longer retained by the borrower, the Law Society Guidance Note advised that the consent may no longer apply in any event.
The Court found that the circumstances of this case were indistinguishable from those which arose in Mortgage Express v Sawali and that the mortgage terms which the Mortgage Business sought to rely on to recover the solicitor’s full file stopped any claim for legal professional privilege preventing access to all the documents on the conveyancing. As long as The mortgage terms were unambiguous they will be binding.
Des Hudson, CEO of the Law Society for England and Wales has communicated with its members on the 6th March with an update on the new Santander Conveyancing Panel Portal, also known as the Lender Exchange.
Mr Hudson says in this communication that during a recent meeting with Decision First he raised concerns about a recent declaration form sent by Santander which asks solicitors to agree to information being passed to group companies of Decision First for the purposes of sending information about relevant goods or services. This presumably relates to searches and defective title insurance.
In an effort to allay concerns Hudson says “We have been reassured that this is only an option and members are not required to agree to this request as part of the conditions of being included on the Decision First system. For those members who may have already done so and wish to opt out you can do so by putting this in writing to Decision First via the Lender Exchange system once it is operational. We urge firms to consider carefully that issue”.
In the meantime it looks as though the start date for the Lender Exchange is going to be delayed. In an interview with Decision First published by Todays Conveyancer, it is acknowledges ‘ We had March 31 as the anticipated launch but it’s probably going to slip back by a couple of weeks as we have amendments to make off the back of some late changes to terms and conditions and some changes to screens to make it easier for firms. But that’s just the nature of the beast of systems development, so we’re now looking at launching to firms around the end of April’
Failing to comply with CML Handbook requirements has once again landed a conveyancing solicitor in trouble with their regulator. This time it’s Scottish lawyer lawyer Iain Haywood who was guilty of “professional misconduct” after being involved in three “back to back” property transactions back in 2011. The Scottish Solicitors’ Discipline Tribunal levied a fine of £2,000.
The Scottish tribunal took the opportunity to emphasise that in failing to comply with the reporting obligation contained in the CML Handbook it leave lenders exposed to mortgage fraud.
Mr Haywood is not the first and is unlikely to be the last lawyer in failing to inform the lender that the seller had owned the property for less than six months.
As if to compound matters Mr Hayward omitted to advise Birmingham Midshires that the purchase price paid by the borrower in the end purchase was a “substantial increase” on that paid by the mid-purchaser. He also failed to advise the lender that a deposit for the purchase price was not provided by the purchaser.
It will be interesting to see if the SRA in England and Wales start to follow the SSDT’s lead in taking disciplinary action for failure to comply with CML Handbook Requirements.
The full written decision can be found here