Legal expert welcomes HSBC mortgage move
Changes by banking giant HSBC to its conveyancing approach have been welcomed by a East Midlands property law expert.
Carole Fox, head of residential property at law firm Rothera Dowson, believes that the newly announced alterations will make the mortgage process faster and more cost effective for thousands of homebuyers.
In January of this year, HSBC introduced a system that only allowed firms on its managed panel of conveyancers to act for both the borrower and the lender, meaning that the choice was restricted to just 42 firms. If the borrower wanted to use another firm to act on their behalf, they had to pay an extra charge of £192.
However, changes have now been made to this rule and from August every solicitor that is accredited with the Law Society’s Conveyancing Quality Scheme (CQS) will be able to act on behalf of both HSBC and the mortgage customer.
“To say that the introduction of the initial system proved unpopular is an understatement,” commented Carole.
“There was a lot of controversy surrounding the initial announcement and this has continued over the past few months. If buyers wanted to use their own firm, costs would mount and many found that the whole process was taking longer.
“These changes are great news and mean that those who have mortgages with HSBC are no longer being charged for expressing freedom of choice.
“The move means around 1,400 CQS accredited firms can now be used to handle all cases with mortgage values up to £150,000.”
As part of the changes, customers will have the choice of using a firm from the existing managed panel or a CQS accredited firm. The third option is to use a firm that does not fit in to one of the previous categories, but the borrower will still have to pay a fee of £160+VAT.
“This applies to around 3,500 non-accredited firms,” concluded Carole. “So for them, the fight still goes on and I don’t see the HSBC mortgage row ending any time soon. However, in the current climate, anything that opens up the buying process and begins to remove previous restrictions is a step in the right direction.”