John E Jones, director for learning and development at Goldsmith Williams, said: “I did not know whether to smile or frown when I read Steve McColl’s comments in the January 2012 issue of Bridging Introducer.
“It comes with the territory that, at times, the conveyancer is blamed for transactions taking longer than expected.
“This is often because others involved in the transaction perceive that the conveyancer is deliberately being difficult over certain issues or “sticking his oar in” in areas outside his retainer.”
But Jones claims good conveyancing solicitors are generally pro-broker, pro-lender and pro-packager, working hard to ensure that bridging loan transactions complete as quickly as possible.
In January’s issue of Bridging Introducer McColl, investment partner at Soho Corporate and a bridging finance specialist, said: “My view is solicitors should get their heads down and get on with the task that they are being paid to do.
“In other words complete the documentary requirements and get the funds drawn down for their client, and keep ill-thought-through comments to themselves”.
Jones claims McColl has sold conveyancing short by describing it as “completing the documentary requirements”.
He said: “I agree with him that solicitors should not comment on whether or not a particular loan product is suitable for a client – the client has already had that advice from their IFA – but the solicitor has a duty of care to the client to ensure that he or she fully understands the legal implications of the mortgage they are entering into, that their title is “good and marketable” and that any concerns or doubts they may have are addressed.
“Remember it is the solicitor who is certifying that the title is good security for the loan. This carries important responsibilities for the solicitor as well as the liability if something goes wrong; a situation that others in the transaction do not face.”
McColl suggested in his column that brokers, packagers and lenders should compare notes and be aware of practices the market over.
Jones said: “I concur with him but why not include solicitors in that process?
“If the various parties involved in the bridging market could come to a general consensus as to what is required in terms of documentation, compliance and advice, there would be fewer incidents like those he describes and fewer margins for delay.
“All parties would benefit from such a consensus but in particular the client. Good bridging solicitors are out there and we are not that difficult to find!”
McColl said: “Most clients arrive at the table with a long standing family or corporate solicitor and nine out of 10 times these solicitors will have zero experience of dealing with bridging.
“Bridging has significantly more thorough legal diligence than standard mortgages, as the major strength of the case rests in the underlying property asset, rather than the strength of the borrower.
“It is in these instances that we the brokers / lenders are fighting an uphill battle against those who are uneducated in our methodology and practices, hence the problems mentioned in my column.
“It is taken as read that firms such as Goldsmith Williams are bridging legal experts.
“It is my opinion that brokers and lenders should be steering clients away from the 'mom and pop' legal firms to those that specialise in our sector’s requirements... with the net result being to get the deal done.”
