Law: UK Finance must rethink this immediately
Conveyancers have reacted furiously to the introduction of an annual fee of £50 per user to access the Mortgage Lenders’ Handbook.
The Society of Licensed Conveyancers (SLC) described the fee for access to instructions that conveyancers must follow when acting for lenders as “outrageous, unjustifiable, and wholly unacceptable”.
Announcing the move, trade association UK Finance said the new platform for the handbook would be launched in March, when “generic” logins would be discontinued and access would only be possible through individual user accounts.
During the first three months, until 1 June, access would be free, but after that an annual charge per user of £50 plus VAT would apply.
Simon Law, chair of the SLC, said: “UK Finance is effectively telling conveyancers: pay us if you want to follow your client’s instructions. This is absurd. No other profession is charged to access mandatory instructions from its own clients.
“The profession will not accept paying for access to instructions we are obligated to follow. UK Finance must rethink this immediately.”
Rob Hailstone, CEO and founder of the Bold Legal Group of over 700 conveyancing firms, commented on LinkedIn: “Not only should this new charge not be being imposed, but lenders should be paying conveyancers and providing free updates every time they feel the need to change anything in part 2 of the handbook.
“The government wants the home buying and selling process to be quicker and cheaper. This new version of the handbook will deliver neither of those things. In fact, quite the opposite.”
Mr Hailstone said that unless UK Finance relented, not only did conveyancers need “to collectively push back against this new charge”, but they needed to reopen the debate about working for lenders for free.
CILEX described the fee as “a compulsory cost of doing business, with no realistic alternative”.
A statement went on: “That leaves firms facing a stark choice: absorb the cost at a time when conveyancing margins are already under strain or pass it on to clients and push up the cost of moving home yet again. Either option adds financial pressure in a sector where affordability is already stretched.
“Passing the fee on is not without risk. If handled incorrectly, it could raise regulatory questions around how client money is held and accounted for, including anti-money laundering considerations.
“We also want clear answers on whether lenders will face equivalent charges, or whether conveyancers alone are being asked to foot the bill.”
Mark Evans, president of the Law Society, said the society was “extremely disappointed” that despite “clear objections” raised on behalf of members, UK Finance was proceeding with the move.
“Conveyancers have no choice but to use the handbook for each transaction. A situation is being created where conveyancers will now have to pay lenders when providing a legal service to them.
“This compulsory charge is being imposed on conveyancers without any serious consultation or communication with the sector. It will increase the cost of conveyancing for conveyancers and ultimately for their clients.”
In response, a spokesperson for UK Finance said a “more resilient, secure, and user-focused” platform was being introduced.
“The new handbook will require each user to set up their own individual login, enabling them to tailor the handbook to their needs and benefit from an enhanced user experience.
“This will not necessarily mean that every conveyancer requires or must pay for a separate licence; for example, a firm may hold a single licence for a paralegal who undertakes searches on behalf of multiple conveyancers.
“We will continue to work closely with the law societies, conveyancers and our members during the initial rollout to assess the approach to charging.”