Moving Home Reform
The Conveyancing Association, a leading body in the conveyancing industry, has published a White Paper calling for big changes in the house moving process, to make the experience more positive.
It identifies the issues as including the steadily increasing transactions times, now some 12-14 weeks, and general dissatisfaction by stakeholders and customers alike as to the speed transparency and certainty of the home moving process.
Speeding up the system
Called Modernising the Home Moving Process, the paper - written after extensive research - details a number of changes and proposals the CA feels would pave the way to creating greater certainty far earlier in the home moving chain of events, including:
- Centralising the identity verification of the parties to reduce the risk of fraud and money laundering. Currently a customer may have to go through this process several times with their conveyancer, estate agent, and mortgage lender.
- Collating the property and title information on the marketing of the property to be supported by a conveyancer's certificate. This self-complied 'skinny' electronic home report would provide information up front, but be a more available and economic approach than the old Home Information Packs.
- Requiring a legal commitment on offer with a five day cooling-off period, either through a reservation agreement or conditional contract. The thinking is to mirror practice in the current new-build process where customers enter into reservation agreements including payment of a deposit. In practice this should also have the effect of compelling buyers to have finance in place prior to making an offer.
- Reviewing the current standard contract conditions to require completion monies to be sent through the day before completion to provide certainty on the day of completion.
- Amending current legislation to resolve the unreasonable cost and delay associated with leasehold sales, including the introduction of a redress scheme. The proposals here include the creation of a Register of Lease Administrators, so the person responsible for providing a 'buyers' pack is easily identifiable and also to create set fee scales.
Partner Susan Ellis, head of Wards Solicitors' conveyancing team, comments:
Leasehold transactions involve a number of challenges. An increasing number of freehold developments also now include management arrangements and are subject to the same issues. Sellers could do much to reduce delays and issues on their transactions by organising themselves and their information before they commence marketing, but rarely do so.
Expense is a factor, with many freeholders or managing agents charging high fees to provide 'buyers packs' and being slow to do so. A seller is reluctant to pay these fees prior to a sale being agreed, and to possibly pay a further fee if the information needs updating. Sellers pay fees for information needed, but buyers can be subject to exorbitant fees for complying with the requirements imposed on change of ownership.
Only Government intervention can provide the additional protections needed to redress the balance of power between the managers and the consumers.
Conveyancers commonly act for a buyer and their mortgage lender. The mortgage lender has its own interests to protect. Many now will acknowledge a request for the release of funds, but not all. Most have very poor lines of communication with conveyancers and a call to a lender will rarely take under 30 minutes. Lenders could do more to assist with the process once they have issued a mortgage offer.
More certainty needed
Having been a conveyancer for over 30 years, there have in fact been many underlying changes over this time and a good many recently with the use of technology.
However, it has never ceased to amaze me that nothing has ever been done to change the completion process to provide more certainty on the day people move, and potentially make a massive difference to all involved.
Conveyancers operate formulas for exchange, and it should not be beyond the Law Society to provide something for completion.
We commonly send completion monies 'overnight', but when there is a chain we are dependent on the funds arriving from the related sale which creates uncertainty. It does not help when conveyancers order mortgage monies for the day of completion and then hold up a chain waiting for them to arrive.
The Government indicated in a debate in June that it would publish a 'call for evidence' later this year to modernise the home buying experience. Past attempts at reform, have all been spectacular, and very expensive failures. First the Land Registry's Chain Matrix, then the 'ill-fated' Home Information Packs, and latterly the Law Society 'Veyo' white elephant.
The proposals from the Conveyancing Association come from the industry itself. Some, they say involve 'blue sky thinking'. The reality is that perhaps an approach looking for 'marginal gains' would be a good starting point, with stakeholders all playing their part and looking at changes that can be made by them.