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. This will increase costs for consumers and could lead to delays if they choose their own firm.
In a letter to its members last week, Desmond Hudson, chief executive of the Law Society, 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 customers with delays to the process, which threaten 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 extra costs and delays associated with HSBC’s current panel and that as a result some clients are opting for other lenders.
However, a spokeswoman for HSBC says it has had no experience of estate agents advising borrowers against using it and that The Law Society’s letter to its members is the first it has heard of such a practice.