The issue of ‘free legals’ has come under the spotlight again following complaints by one broker against Conveyancing Direct Property Lawyers.
The legal firm owned by Skipton Building Society is used by a number of lenders that offer ‘free legals’ to consumers.
Mortgage brokers Davidson Downing contacted Mortgage Strategy after experiencing “atrocious” delays with the company, and then finding his complaints were “effectively ignored”.
As a result of this experience, the firm is now calling for an overhaul of the way these legal services are provided.
Mortgage broker Arron Bardoe – who works at Davidson Downing – says he’d like to see more lenders offering cashback to cover legal costs, with brokers responsible for procuring these legal services.
Nationwide Building Society has already started offering this as an option.
This complaint follows news that Breeze Plus has been dropped by Barclays from its panel of solicitors.
The lender continues to offer both free legals and cashback to consumers.
Bardoe says his main concern was that Conveyancing Direct appeared to have no effective process for escalating complaints, once a problem had occurred.
He explains: “Our last two cases where they [Conveyancing Direct] were appointed as the lenders’ solicitor were handled atrociously. In one case it took six weeks to offer a redemption statement, with another there was a delay of three months from offer to completion.”
In both cases, clients stood to lose hundreds of pounds in interest he says.
“But when we asked for these complaints to be escalated internally, as the company had exceeded their internal service levels, these requests were simply ignored.
“We then escalated both through the two separate lenders involved – one of which was Skipton Building Society – and again they failed to act.
“One might expect their senior team to roll up their sleeves and seek to reassert confidence, but there is a high degree of both audacity and arrogance to ignore requests from two of the UK’s largest lenders to get these cases resolved.”
Bardoe adds that he would expect service standards to rise if the choice of the solicitor falls to the broker. “I expect solicitors will find keeping thousands of
coal-face brokers happy will be more challenging than pleasing a small number of lender procurement managers.”
He is not the only broker complaining about these legal services. Coreco director Andrew Montlake says: “There are massive problems with this ‘free legals’ system. It needs a complete overhaul.”
He adds: “At the root of the problem is the fact that lenders are squeezing solicitors on costs. This affects their ability to deliver a decent standard of service. It’s becoming a numbers game. We’ve seen cases where solicitors don’t reply to broker queries or aren’t returning calls. In some cases brokers can be left hanging on the telephone for up to an hour, only to find the call drops out.”
Montlake says he now warns clients against mortgage deals that offer these ‘free legals’.
“In some cases we make them sign a disclaimer saying we have warned them that this could cause delays,” he adds.
Conveyancing Direct managing director Andrew Hiesley says: “Conveyancing Direct has a clear process for handling issues and for escalating them as complaints if needed. I am keen that all complaints are investigated and would apologise to anyone who feels that this has not been the case. I can’t, however, comment on individual cases.”