Estate agents have started to alert mortgage borrowers over possible problems in using HSBC because of its recent decision to cut its conveyancing panel to just 42 firms, according to The Law Society.
HSBC made the decision in January and although customers are free to choose their own solicitor, HSBC will still use a panel firm for its own legal work, which could increase costs for clients and lead to delays if consumers choose their own firm.
In a letter to members this week, The Law Society chief executive Desmond Hudson says delays are emerging for mortgage applicants using HSBC. He says: “The society understands that a number of estate agents are beginning to associate HSBC mortgage customers with delays to the process, which threaten what are already delicate property chains.
“We are aware that some estate agents are advising caution to consumers who are considering an HSBC mortgage.”
It says many of its members are highlighting to their clients the potential additional costs and delays associated with HSBC’s current panel and that as a result some clients are opting to go to another lender.
The Law Society says it is making headway with its campaign to alert borrowers of the detrimental effect HSBC’s decision is having, with many of its members lobbying politicians and consumer groups.
It says it has been contacted by a number of MPs, as well as Edwina Hart, the minister for business, enterprise, technology and science, in the Welsh government.
An HSBC spokesman says: “We have seen no evidence to suggest estate agents are advising customers elsewhere, in fact, we have had the strongest ever start to the year for mortgage sales.”
London & Country associate director of communications David Hollingworth says: “For The Law Society to make this sort of announcement it must have serious concerns about the effects HSBC’s slimmed-down panel is having on the cost to customers and service levels.”