Dear colleagues
As you will be aware, the Law Society has been grappling with the issue of changes to residential conveyancing panel membership for at least the past two years.
While the Society recognises the imperatives driving lenders to introduce changes to the composition of their panels – mainly the intervention by the Financial Services Authority, which has called upon lenders to manage their panels intensively as a result of the need to react to the threat of fraud in the mortgage process – we consider that many of the changes lack coherence, are based on questionable rationale and impact on both the profession and the public in a damaging way.
Following the latest decision by a major lender, in this case Santander, to reorganise their conveyancing panel using what we consider to be a crude and unfair methodology, I have written to the secretary of state for business. I have asked Dr Cable for his support in leading a mediated dialogue between the Society, the Council of Mortgage Lenders, the banking regulator and the lenders themselves in order to reach an amicable, long-term solution that is in the best interests of consumers, lenders and solicitors.
As I explain in my letter to Dr Cable, such a dialogue is made necessary by the very serious implications of highly restrictive panels for the economic viability of many high street legal practices, exactly the sort of small and medium sized businesses the government has stated to be vital to economic recovery, as well as the principle of consumer choice and the wider consumer interest.
During any resultant discussions the Society will emphasise that the Conveyancing Quality Scheme (CQS), by creating a trusted community of conveyancers and establishing an agreed minimum standard of practice, can address the key concerns of lenders, while avoiding the damaging impacts of unnecessarily restrictive panels.
In urging a mediated dialogue, it is important that members of parliament are kept informed of the potentially damaging actions of the banks on firms and consumers in their constituencies. I have therefore attached a briefing pack which sets out how you can lobby your own, or your firm's, MP in order to raise your concerns and seek their assistance in raising the issue with the secretary of state.
If you require any further information or assistance engaging with your local parliamentarians please contact the Society's Government and Parliamentary Affairs Unit at parliamentary@lawsociety.org.uk.
Yours sincerely
Desmond Hudson
Chief executive