First time buyers: helping them through the legal process
Kathryn Stone OBE explains how legal service providers can help customers understand the legal process relating to house purchases.
About the author
Kathryn Stone OBE is the Chief Legal Ombudsman.
T he Legal Ombudsman is a free, independent service that helps to resolve disputes between legal service providers and their clients. Last year, the scheme resolved 6,500 complaints, including over one thousand relating to house purchases.
Conveyancing is the most complained about area of law in England and Wales accounting, on average, for nearly one-quarter of all the complaints we see here at the Legal Ombudsman each year: a failure to advise clients appropriately, delays and failing to communicate usually drive conveyancing-related complaints to our scheme.
Sometimes when things go wrong for home buyers, it can be a source of real frustration and even worry – no more so when their conveyancing lawyer is at fault. Our experience shows that the complaints we help resolve often involve first time buyers. They are particularly at risk since they are going through the process for the first time and, often, do not know what their lawyer has responsibility for.
Earlier this year, we reported on a first time homebuyer, who had suffered sleepless nights after being asked to fork out £20,000 in outstanding repairs on a newly bought flat. The conveyancing firm handling the sale had known about the costs before their client signed the contract, but failed to inform her.
When the client complained to the firm, it accepted that it had made a mistake – having received a letter about the costs before she completed the sale – but offered just an £800 refund of its fees. We investigated the case after she raised her complaint with us, and recommended that the firm pay a full reimbursement of the £20,000 plus compensation.
On the back of this particularly shocking case, we decided to publish guidance for first time buyers.1 You can help us by sharing the guidance with your clients.
Make it clear to your clients that checking the appropriate planning permissions are in place, and advising on any ongoing financial obligations that come with a property and raising enquiries with the seller about matters such as boundary responsibilities, are within your remit. Clients can then rightfully expect that these things are taken care of in exchange for their conveyancing fee.
You can add further clarity by advising your client that checks on building and structural issues, in general, are not within your remit. This is, of course, information that prospective buyers can obtain via a homebuyers survey or a more detailed report from a structural surveyor.
Greater transparency from all service providers involved in the house-buying process will help us to reduce the number of complaints we receive at the Ombudsman. More importantly, it will make the experience a happier one for home buyers in what is one of the biggest transactions they will make in their lives.
The Legal Ombudsman has just published the latest data analysis on residential conveyancing.2
1 On the move: A guide for first time buyers, along with more information about the Legal Ombudsman, is available at: http://tinyurl.com/jpcgaab
2 2015/2016 Residential conveyancing complaints data, available at: http://tinyurl.com/zb7za7x