HSBC is changing its conveyancing approach to allow all solicitors accredited with the Law Society’s Conveyancing Quality Scheme to act for HSBC and its mortgage customers.
Previously only firms on HSBC’s managed panel of conveyancers could act for both the borrower and the lender, with all other firms able to act for the borrower only.
Initially, CQS-accredited sole practitioners will only be able to handle cases with mortgage values up to £150,000.
The new arrangement will be introduced in August 2012.
In March, the Law Society warned estate agents were advising borrowers not to use HSBC because of its decision to cut its conveyancing panel to just 42 firms. This meant that while customers were free to choose their own solicitor, HSBC used a panel firm for its own legal work, which increased costs and lead to delays in some cases.
Under the new system, HSBC mortgage customers will have three options when appointing a solicitor or conveyancer.
They can use one of the current managed panel firms, a CQS member that is not on the panel or choose their own firm of solicitors or conveyancers, in which case the borrower will pay £160 plus VAT for a panel firm to complete the legal work required by HSBC.
HSBC head of lending Martijn van der Heijden says: “We introduced our panel in January to provide additional protection for both our customers and the bank. We listened to feedback from customers and solicitors, and through working with the Law Society can now agree to more solicitors acting for us while also managing our risks and maintaining the unique benefits of using one of our panel solicitors.
“We are committed to helping our home-buying customers and have set aside £15bn to lend in residential mortgages this year.”
Law Society chief executive Desmond Hudson says: “The Law Society and its members have campaigned for this change in the interests of solicitors’ home-buying clients since HSBC introduced its original panel. HSBC’s willingness to engage with us has helped secure a good outcome for their mortgage customers, our CQS members and the house buying public.”