Aldermore Bank Conveyancing Panel Information

It is not apparent if there is a question here. We acknowledge that there are an increasing amount of lawyers in Scotland who point to the concerning development in 2013 where in a solicitor disciplinary case in Scotland where the Law Society of Scotland has prosecuted a conveyancing solicitor for repeated failure to comply with the CML lenders’ handbook. While the solicitor’s failures cannot and should not be forgiven, the clear message from the LSS is that its auditors will examine the minutiae of a solicitor’s purchase file for compliance with the CML lenders’ handbook. They will report and potentially act on any non-compliance they discover, insignificant or otherwise, irrespective of whether there has been any fraudulent or otherwise criminal activity on the part of the solicitor, and irrespective of the presence or absence of a complaint by the lender.

This is known as the ‘Borrower/Lender Exception’ which states “In the case of a loan to be secured over heritable property, the terms of the loan have been agreed between the parties before the Solicitor has been instructed to act for the Lender, and the granting of the Security is only to give effect to such agreement.”

At the center of this exception is the reference to the prior agreement of the parties on the terms of the loan and that the Security is in effect “execution only”. Thus if one Solicitor acts for the purchaser who is also a Borrower and the Lender then there is no duplication of work nor of expense.

However the requirements of Lenders in 1986 when the exception was introduced were quite different from current requirements. Requirement after requirement has been heaped on to the Borrower/Lender Solicitor (BLS) and it appears commonplace to expect utmost good faith from the BLS and knowledge by the BLS must be passed on to the Lender if it would affect the decision to lend.

This causes issues of confidentiality to arise. The BLS has a duty of confidentiality to the Borrower and is being put under a duty to the Lender that requires disclosure. This is undesirable. If a separate Solicitor is acting for the Lender he will only know what the Lender has told him and will report anything untoward that comes up during the transaction but he will not know the confidential information of the Borrower and be under a duty to disclose it. The effect of this exception in practice is to erode client confidentiality and put the BLS in a conflict of interest situation with regard to that issue.

A good reason for retaining the exception is that the BLS can do everything necessary to meet the date of entry and control things much better than if he has to run everything he has decided passed a separate Lender Solicitor. An effect of removing the exception may be a slowing of conclusion of missives while a Solicitor for a Borrower wants to know that the Lender’s Solicitors will accept the title or other related issue position.

Lexsure has not been advised of any intention on the part of the CML to develop such a search facility.

We only know of two or three lenders that operate a separate conveyancing panel where the mortgage advance is over a certain threshold. You should nevertheless check directly with Aldermore Bank. At one stage HSBC would only allow Sole practitioners to act for them where the mortgage was below £150,000. We are not sure if HSBC still operate such a condition. In your case it is best to check with Aldermore Bank