With both Nationwide and Barclays changing their UK Finance Handbook part 2 requirements recently (to differing degrees of impact on, and push back from, conveyancers feeling the pressure of the SDLT deadline), it is topical to think about some of the tools available to support conveyancers keep abreast of these sorts of changes and what else might potentially make life easier for all concerned in the process.
Many conveyancing firms will already subscribe to tools which push out notifications of any change to the Handbook. Others may use something which goes a step further by not only providing updates but which also allows users to search for changes and save results back to case management systems or which displays case and lender specific requirements real time during title checking.
At Orbital, we were able to act fast for our clients using Orbital Residential: pulling in lender requirements live from the UK Finance Handbook, with key questions pulled in for the lender of your choice to ensure none of our customers were caught out by recent changes. Technology makes this possible, but it doesn’t solve the underlying issue.
Whilst the detail of how regulators approach conveyancers meeting lender requirements may differ, (most SRA firms doing conveyancing will be CQS accredited and be subject to specific requirements about evidencing compliance whereas the CLC sets higher level expectations in acting for lenders which they expect their regulated community to meet), the end result is the same. A conveyancer must understand and follow their lender clients instructions and requirements (including those in the UK Finance and BSA Handbooks as well as the mortgage offer) and is expected to demonstrate that they can do so, including taking into account any change in instructions which might occur during the course of the transaction.
Given the wide range of approaches taken by lenders in setting their individual requirements and their ever increasing scope and complexity, it’s perhaps no wonder that lenders have seen an increase in post offer referrals from panel firms seeking permission to go ahead or clarification of a particular point.
I believe this cautious approach and reluctance to exercise discretion is perhaps inevitable for conveyancers who’ve been around long enough to remember the last recession, the rise in repossessions that followed and the consequent rise in professional indemnity claims resulting from issues on re-sale. Easier to report rather than risk potential criticism, potentially years later with the benefit of hindsight, for using their judgment in interpreting lender instructions. Even those who are newer to the profession are ever mindful of the blame game when things go wrong despite their best efforts.
Whilst I absolutely agree with the right and desire of lenders to tailor their requirements based on their own appetite for risk, their lending profile and past book of work, it does seem to me that there’s surely scope for a more collaborative approach. With all the debate raging about what will and won’t improve the home buying experience for clients and reduce transaction timescales, there is a quick win here: lenders looking to make anything other than basic changes to their Handbook requirements should (as a matter of course) consult briefly with practitioners on the front line, rather than operate in a silo without conveyancer input. That would give an opportunity to understand whether the proposed wording is clear, to give some context to the decision and iron out any potential unintended consequences. Once finalised, lenders could push updates out to their panel lawyers fairly easily via Lender Exchange and LMS and could even provide a couple of example scenarios where this would aid understanding. Giving clarity of the position on cases which have already exchanged would save conveyancers and clients unnecessary delay, risk and worry too.
It seems to me that there are plenty of existing avenues for this type of collaborative approach, whether that’s a few select individuals at panel firms or via members of representative bodies such as Law Society and CLC, the Bold Legal Group or the Conveyancing Association. I’m sure some excellent, practical, senior conveyancers would be more than happy to contribute their time and expertise given the importance and potential consequences both for conveyancers and their clients. And it doesn’t have to be a long winded process either. What’s most important in my view is to harness the expertise of conveyancers who are dealing with these issues in practice, rather than those who are no longer involved in the day-to-day realities of these transactions.
Sarah Debney, Orbital Witness
This article was submitted to be published by Orbital as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.
