Allsopp: People should not be charged more for using their own solicitor
The practice of estate agents forcing buyers to use their preferred lawyers, or at least charge more if they do not, has come under the spotlight thanks to TV personalities Martin Lewis and Kirstie Allsopp.
Ms Allsopp described estate agency receiving referral fees from financial advisors and conveyancers as a sharp practice.
Earlier this month, Mr Lewis tweeted: “Is your estate agent hard selling its mortgage broker or solicitor? Too many do, skirting the edge of the law, it’s known as ‘conditional selling’.”
He was publicising a new guide on his Money Saving Expert website about this “dodgy practice”, which it said was “widespread”.
The guide points out that it is against the law for an estate agent to tell buyers they must use those services if they want their offer submitted to the seller or that their offer will have a better chance.
It says that using an estate agent’s in-house solicitor “can work out”, but there are potential issues to consider, such as that these solicitors “aren’t necessarily the cheapest”.
The guide tells buyers not to believe a claim that using the preferred solicitor will speed up the process – “In reality, it’s unlikely an estate agent could help speed up the legal process by ‘leaning on’ the solicitor” – but what should help “a little bit” is “lining up a conveyancing solicitor early on, meaning you’re ready to instruct them as soon as you’ve had a property offer accepted”.
Ms Allsopp, famed for her Channel 4 property programmes, has been tweeting about the same issue and got into an exchange with South-West estate agency Bradleys over it telling customers that, unless they used its conveyancing service, they would have to pay a charge for compliance checks.
“How can you justify charging a purchaser in this way, is this in the best interests of your client, the vendor? Surely you can read a bank statement and mortgage offer letter?” she demanded.
Bradleys responded by pointing out that “there is more compliance than ever in estate agency” and so it charged “a small admin fee per purchaser” for anti-money laundering checks.
Replying to another tweet from the broadcaster, it said that “through the secure platform (therefore people aren’t risking emailing personal details) we can also share this with our conveyancers so they don’t have to carry out the same checks and charge for the same. This saves clients on duplicating work and costs”.
Ms Allsopp said: “These checks are carried out by a purchaser’s solicitor, that they will choose themselves, bullying them into using your conveyancer is wrong.”
Bradleys replied: “We are also legally required to carry out these checks, which costs us to do so, and we are giving an option to save having to do it twice by using our preferred local law firms. Hardly bullying!”
Ms Allsopp described the agency’s approach as “unbelievable, charging people more because they want to use an independent solicitor is completely wrong”.
Bradleys’ website says that it receives an average referral fee of £289 for sending customers to its conveyancing service.
Others shared their experiences with her, with one recounting how their estate agent said they would be charged for using their own solicitor. “Knew it was illegal but we were competing with 9 other people for the same house so went with it,” they wrote.
Ms Allsopp has continued to tweet about the issue. “If agents can’t make a living in the old way, charging their client, the vendor, the person whose best interests they are paid to represent, then they should put up their fees. Charging buyers fees and relying on kick backs from mortgage advisors & solicitors is [sharp] practice.”
She also said she got “so cross with agents who let the side down and take money to recommend cheap solicitors. In my experience solicitors are just as often the problem as bad agency, or ill prepared sellers or buyers”.
Ms Allsopp has moved on to urging the government on a daily basis to take “an interest in our broken property transaction system”.
Newnham & Jordan Solicitors 
It may not be Solicitors to whom the conveyancing is referred but the points and arguments of Ms Allsopp remain valid.
By charging more for NOT using the preferred conveyancer a buyer is being forced to choose a conveyancer which is contrary to the very principles upon which that conveyancer should be accepting work. Every one has the right to choose their legal representatives.
I note also they suggest that by using a portal the information they collect can be relied upon by the conveyancer. Any conveyancer worth their salt, who wishes to protect their PII, who has read the AML Regulations and who wishes to comply with their Regulator’s Code of Conduct and guidance will be doing their own checks.
This incident encapsulates what is actually wrong with conveyancing. Ridiculous justifications for nothing more than greed which is not in the Seller’s or Buyer’s best interests at all. The whole control and communication spiel is a smokescreen for greed. Paying referral fees is about greed.
This is an opportunity for NTSELAT to act.
This is precisely why estate agents need to be regulated.
This is why the conveyancing process is slow in certain quarters. Volume over client care. Greed over professionalism. There are many conveyancers who refuse point blank to get involved in such conduct and offer an efficient, professional service.
Let the buyer and seller choose their legal representatives. Anything to prohibit that is abhorrent.