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Legal definition

Don’t remain in the dark

Confused by the plethora of legal jargon in the mortgage industry or want to know what a legal term or practice means? Each month our panel of experts answer questions sent in by readers.

Eddie Goldsmith, partner at Goldsmith Williams

Q: Why are supermarkets and banks going to start offering conveyancing services?

A:

The legal profession is about to go through the biggest shake-up since it began and it will happen in the next couple of years. The government is deregulating some aspects in the provision of legal services and is going to allow banks, supermarkets and other organisations to own law firms. This might mean Tesco could offer conveyancing services to customers and carry out conveyancing with lawyers employed by it.

The legal market is worth almost 1bn and services such as conveyancing are readily commoditised – so they can be processed with administrative staff rather than exclusively by lawyers.

It’s going to be an exciting time for lawyers and potentially a very financially rewarding time for strong brand operations which can see the benefits of adding legal services to their present offering.

Q: Will Home Information Packs speed up the conveyancing process substantially?

A:/ It is true that one of the intentions behind the government’s initiative of Home Information Packs is to speed up the conveyancing process. The fact that sellers will have to put a pack of information together before marketing the property should obviously be of use to prospective buyers of property and may well save time later on in the transaction, thereby reducing the time between offer and completion.

The sceptics say this is not really going to make any appreciable difference. They point out that whatever is in the pack the buyers’ solicitors are still going to raise enquiries on ambiguous or missing information and the buyers will still be waiting for their mortgage offer or their chain to fall into place before they can proceed to exchange. I am personally pessimistic that HIPs alone will make much difference to the timescales involved but they will be an increasingly important part of the ongoing evolution towards the e-conveyancing process. However, do not expect miracles from June 1 because there are not going to be any.


Caroline Havers, partner at Salans

Q: What is e-conveyancing?

A:

E-conveyancing is an electronic system designed to make the conveyancing process paperless and make the procedure simpler and a lot more visible. It will be complemented by the creation of a new system to upload contracts and supporting documents, which will offer a viewable version of the land register to reflect proposed contractual terms.

Visibility of the process is being provided by the development of a chain matrix which will allow the user to see if there is any hold-up or blockage preventing the exchange of contracts. Electronic signatures will be applied to a variety of documents and contracts throughout the process as well. Also, the move towards electronic funds transfer will facilitate and improve electronic dealing.

Another development that could save time and money is the closure of the registration gap that now exists. With a slicker e-conveyancing system at completion, the new title and mortgage will be instantly registered with the Land Registry, Stamp Duty Land Tax will be settled and old mortgages discharged. E-conveyancing is not the answer to everything, but should benefit everyone involved in the housing market.

Q: Is there an advantage to using a volume conveyancer rather than a high street firm?

A:

Volume conveyancers are specialists that have reduced prices over recent years and now provide a highly competitive service.

The key for a mortgage broker or packager is to find a quality conveyancer it can work with and in which it can have confidence. Volume conveyancers quickly realised that information is fundamental to their proposition and the good ones have websites that can provide quotes and e-transmission systems enabling users to track their client’s case online so that they can keep their client informed.

Specialist conveyancing firms have made great strides in the intermediary market because they are able to add value in making a complex process better and easier to understand for both the intermediary and their client. While there is a government commitment to all conveyancing being done electronically by 2010, the volume conveyancers are already ahead of the game and are now carrying out the majority of their work via email and the internet.


Send your questions to mortgage.distributor@centaur.co.uk

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