The association conducted a survey of its membership and identified the biggest concern for the majority of CA members was lenders’ continued policy of reducing their panels in order to manage the risk of mortgage fraud.
However CA member firms recognised that lenders are entitled to restrict their panels to manage risk and that it is up to the industry to work with them to demonstrate they can readily meet lenders’ requirements. Members in fact, welcomed the challenge and see the changes that will follow as an opportunity to root out those firms who are either incompetent or fraudulent.
Members acknowledged that the introduction of “alternative business structures” in October will have an impact on the industry but this will present opportunities as well as increased competition.
Over a fifth of members, 22% cited the impact of changes to professional indemnity insurance as their biggest worry and they recognise that this may lead to lenders demanding greater transparency about firms’ insurance arrangements as lenders become more active in supervising and monitoring activity so that it sufficiently covers their risk.
The survey also revealed that member firms, who in total have a significant market share in both the remortgage and transactional conveyancing sectors, said the impact of the significant reduction of transactional volumes and competitive fees will result in far fewer firms specialising in conveyancing in the future.
Eddie Goldsmith, chairman of the Conveyancing Association, said: “These results are highly indicative of the sentiment that has been rippling through the conveyancing industry for some time now. The Legal Services Act which will allow ABSs to practice in the market heralds the biggest change in legal services in decades. This alongside the other pressures raised by our members creates a perfect storm that will force conveyancers to make changes to their business. The danger is that if conveyancers don’t re-assess their business models, don’t improve their standards or qualities and don’t demonstrate effective fraud prevention methods, they will simply lose business.
“Our increasing membership demonstrates that whilst the industry is rightly concerned about the challenges, conveyancers are taking action to adequately prepare themselves. This is exactly why the CA is setting up meetings with lenders and third party stakeholders in the coming months to agree processes and protocols that will distinguish our members from other non CA firms and demonstrate how our members are the natural preferred legal partners.”
The survey illustrated that just over three in four CA members, 76%, are very satisfied with their membership and respondents are happy to recommend the CA to non-member firms.
Sue Brown, partner at O’Neill Patient Solicitors LLP, added: “With all the challenges facing the industry it can be quite difficult to gauge what the future will look like and how it will affect us. Our decision to join the CA was to ensure that we are part of a group that can shape developments in the marketplace that effectively help us to survive and thrive through the changes.”
