Why Does Your Conveyancer Act for Your Mortgage Lender?
What does it mean when a conveyancer acts for a lender?
Most buyers use a mortgage to fund part of their property purchase. In return for providing the loan, the mortgage lender takes a legal charge over the property, which is registered at HM Land Registry. The property therefore acts as security for the money borrowed.
When the same conveyancer represents both buyer and lender, they have responsibilities to each. For the buyer, the conveyancer investigates the legal title and explains the transaction. For the lender, they must confirm that the property is acceptable security and that the lender’s conditions have been met.
What instructions must a conveyancer follow?
Many UK mortgage lenders use the UK Finance Mortgage Lenders’ Handbook, formerly known as the CML Handbook. For England and Wales, it includes:
- Part 1: general instructions that apply across participating lenders;
- Part 2: requirements specific to an individual lender; and
- Part 3: instructions used when a conveyancer represents the lender but not the borrower.
Some building societies instead use the Building Societies Association Mortgage Instructions. These contain a core set of instructions together with each lender’s specific requirements. In every transaction, the conveyancer must also check the mortgage offer, mortgage conditions and any additional instructions issued by the lender.
What is a mortgage lender’s conveyancing panel?
A lender will usually appoint a panel of conveyancing firms that meet its criteria. Those criteria vary and may include the firm’s regulatory status, experience, structure and supervision arrangements.
If your chosen conveyancer is on the lender’s panel, they can usually represent both parties. If they are not, the lender may appoint a separate conveyancer. This can create duplicated work, additional fees and possible delays. Hayward Moon sits on most lender panels, so in many cases our specialists can act for both you and your mortgage lender.
What does your conveyancer check for the mortgage lender?
Your conveyancer will receive a copy of the mortgage offer, usually through the lender’s online portal. They will review the offer alongside the lender’s instructions and check matters such as:
- ownership and title restrictions;
- search results and other relevant property information;
- the lender’s valuation, where supplied;
- buildings insurance and other required policies;
- lease terms, estate charges or management arrangements;
- incentives, gifted deposits or contributions from third parties; and
- any special conditions attached to the mortgage offer.
Can a lender’s requirements affect your purchase?
Yes. You may be willing to accept a particular issue, but your lender may decide that it affects the property’s value, marketability or suitability as security. The conveyancer may need to report the issue and obtain the lender’s approval before proceeding.
Examples can include a requirement for specific insurance provisions, further evidence about the property, or independent legal advice for another person involved in the transaction. The lender may also impose conditions that must be satisfied before funds are requested.
Until the lender’s requirements are met, the conveyancer cannot confirm that the lender has suitable security or safely request the mortgage advance. This is why a lender-related query can affect the timing of exchange or completion, even when the buyer is otherwise ready to move.
How does Hayward Moon keep up with changing lender requirements?
Lender requirements can change, and conveyancers must work from the latest applicable instructions. Hayward Moon has procedures in place to check current requirements and identify updates that may affect your transaction.
A cash purchase is not automatically faster, because every transaction depends on the property, the legal title and the wider chain. However, a mortgage purchase involves additional lender checks and conditions, so choosing an experienced conveyancer who understands your lender’s requirements can help keep the process moving.
Need help with a mortgage-backed property purchase?
Hayward Moon’s specialist residential conveyancing team can guide you through the legal process, liaise with your mortgage lender and explain any requirements that arise. Contact us to discuss your purchase and find out how we can help.
