As we now know, HSBC have reduced the number of solicitor firms who can act for both them and buyer from thousands to just over 40.
An HSBC spokesperson has said that it was not restricting consumer choice; customers will always be able to choose their own solicitor and that it had launched its conveyancing panel to help protect its borrowers from mortgage fraud.
A spokesperson went on to say: “We’ve never had a panel before and all of our customers are able to use their own solicitor if they want. If that is what they choose then we will work with them in a professional way, so we can’t see why it would take any longer for a case to complete.”
However I fear their assumptions are a little misguided and recent comments smack of a complete lack of understanding of the conveyancing process.
If a customer’s conveyancer is not one of the 40 plus firms on HSBC’s panel, this will result in two different conveyancers being involved in the process and there is no getting away from the fact that involving two separate firms of solicitors increases both cost and delay.
The small panel also restricts choice. To prove my point I have just read through the twelve page letter that HSBC’s panel solicitors are sending to the buyer’s solicitor should the buyer insist despite the extra cost that they want their solicitor to act in the purchase.
As an ex-conveyancer with 25 years of experience I can only say that my heart would sink every time a client of mine decided to purchase with the aid of a loan from HSBC.
The onerous requirements would mean that both exchange of contracts is likely to be delayed (giving rise to the possibility of more abortive transactions) and completions would be delayed.
These requirements are no doubt intended to reduce the likelihood of money laundering or mortgage fraud.
What they really do is push the buyer into instructing one of the panel firms turning this into a profit making venture for the panel firm (fair enough maybe) and HSBC.
However if the buyer instructs a panel firm it is likely that they will not be local to the buyer and they may actually never see them in person.
How that helps reduce the chances of mortgage fraud and money laundering is beyond me.
I accept that HSBC can to a degree dictate the size etc of their panel.
However this new regime has been badly conceived, badly put together and badly implemented.
If I was running a law firm with my client account in the hands of HSBC and not one of the lucky (debatable turn of phrase) 40 plus firms, I know what my first course of action would be: to move my bank accounts to a more consumer and lawyer friendly bank.
This new process will upset buyers, sellers, conveyancers, agents and brokers and is a step back to the dark ages of conveyancing.
I accept that money laundering and mortgage fraud need addressing however this is not the solution.
I have one overriding message for HSBC: talk to the conveyancing community, please, before it’s too late.
The Bold Group is headed up by Rob Hailstone and consists of over 130 independent high street law firms, all of whom carry out, amongst other legal services, residential conveyancing.
