Clydesdale and Yorkshire banks have become the latest lenders to restrict their conveyancing panels.
Last week the lenders announced that from April 16 they will only deal with solicitor firms accredited by The Law Society’s Conveyancing Quality Scheme, which number roughly 1,300.
The Law Society has welcomed the move, which is in contrast to HSBC, which recently chopped its panel down to only 42 firms.
Desmond Hudson, chief executive of The Law Society, says it is up to lenders to make decisions about their panels.
But he adds: “Not only is it an assurance of high standards in conveyancing for lenders, but by showing its commitment to the CQS, they are putting customers’ interests first by maintaining a wide panel of trusted firms.”
HSBC announced in January that it would only work with 42 firms and its panel would be managed by Countrywide.
It offers customers incentives to use a firm from its panel, such as fixed legal fees and a guarantee that they will not be charged for legal work if the sale falls through.
Speaking on BBC Radio Four’s Money Box programme recently, Hudson called HSBC’s changes badly thought out and unnecessary. He also told HSBC that if it had concerns about the firms it dealt with, The Law Society would manage its panel for free and ensure it did business only with accredited firms.
But Martijn Van der Heijden, head of lending at HSBC, refused the offer and defended its decision.
He told the show’s host Paul Lewis that it made the changes to reflect what is happening in the lending market, with other lenders restricting their panels to combat fraud and for regulatory reasons.
Van Der Heijden told Lewis: “Our data shows that since we restricted the panel over 99% of cases have gone through without a hitch.”