View more on these topics

Estate agents are warning borrowers off HSBC, says Law Society

Estate agents have started to advise mortgage borrowers against using HSBC because of its recent decision to cut its conveyancing panel to just 42 firms, says The Law Society.

The lender 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 will increase costs for consumers and could lead to delays, if they choose their own firm.

In a letter to its members today 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.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 7 comments at the moment, we would love to hear your opinion too.

  1. I don’t suppose this has anything to do with the fact HSBC won’t pay commission to the mortgage advisers sitting in Estate Agent offices??

  2. 42 firms seem like a reasonable number to me. Enough choice for the customer there. Perhaps the law society has a hidden agenda?

  3. Many lenders have reduced the number of panel Solicitors – its quite appalling that individuals do not have freedom of choice – There are many lenders in the market place who have direct products and dont pay commission – you can always charge the client a fee. Too many lenders offer an extremely bad service and hold mortgage advisers to ransom based upon rates offered…….
    It is important to treat customers fairly and impart this information to them in order that they may make an informed choice,,,,

  4. HSBC do not appear to be restricting the borrower’s right to independent legal advice, but merely limiting the number of firms who will act for HSBC in the transaction.

    The Law Society is fulfulling a valuable function in highlighting this issue, so that the purchaser’s right to choose their representation is not inhibited by cost or delay.

    However, it is totally unacceptable for estate agents to raise this issue with property purchaser – as they act for the property seller and may also be conflicted in respect of their mortgage services.

  5. it seems that the law society is trying to look after the interests of its members.
    thankfully we don’t have a trade association or regulator that would stoop that low

  6. It’s not surprising given the fact that there appears to be an increase in mortgage fraud and home buying where the common factor in the fraud lies with the solicitor.

  7. it seems fairly outrageous for”anonymous” to assert that there is an increase in mortgage fraud and that solicitors are to blame – is there really an increase in mortgage fraud?

Leave a comment