Should I use the estate agent’s recommended solicitor?
When buying or selling a property, estate agents will often recommend a conveyancing solicitor. This may seem helpful but is there an ulterior motive?
The right conveyancer can make all the difference
Buying or selling a house is a huge financial commitment, which is why it is important to instruct a conveyancer that will complete your purchase or sale as quickly and cost-effectively as possible.
The difference between a reactive and a proactive conveyancing solicitor could be the difference between a successful move and your move falling through.
You should therefore prioritise finding a communicative and proactive conveyancing solicitor who will give your move the best chance of completing on time.
Surely the estate agent would only recommend a good solicitor?
Whether you are buying or selling a property, it is in the estate agent’s interest to get the sale exchanged as quickly as possible. Until contracts exchange - the agent doesn’t get paid.
Logic would dictate that the agent would confidently recommend an efficient solicitor that gets sales exchanged as quickly as possible.
The agent may even appear to be so confident in their recommendation that they offer you incentives, such as a reduced commission, to use their preferred solicitor.
So, what's the problem with instructing the agent's recommended solicitor?
Estate agents usually receive a referral fee for recommending a solicitor. Referral fees can be anything from £100 to £500.
Referral fees are not necessarily a problem. Good solicitors pay referral fees too. The referral fee may inflate your conveyancing fees, but this may be a price worth paying if you are introduced to a solicitor who gives you a stress-free service.
The estate agent is unlikely to recommend a solicitor who will do a bad job. However, around 30% of transactions fall through nationally. Slow and uncommunicative conveyancing is one of the main reasons for this statistic. You need a solicitor that doesn't see your move as just another file on their desk.
Individual agents are usually (financially) incentivised by their company's to refer you to a specific solicitor firm. The solicitor firm is often in a tied commercial relationship with the agent's company. Such commercial agreements often don't have the flexibility to recommend another firm if the solicitor is overloaded with work or if service levels start to fall.
Conflicts of interest
Some solicitors can become overly reliant on the estate agent for new work.
If your solicitor is commercially dependent on the agent, then the agent may be able to exert commercial pressure on the solicitor that conflicts with the buyer’s or seller’s interests.
The solicitor may feel under added pressure to cut corners to get a purchase through quickly and keep the agent on side. This might convince the agent to continue referring new clients, but it may not be in the best interests of the buyer or seller.
Advice for buyers
One tactic employed by some agents is to tell buyers that their offer will be favourably considered by the seller if they use their recommended solicitor
Do not be pressured. Remember that the estate agent is legally bound to pass on all offers to the vendor from all buyers.
The Council for Licensed Conveyancers states categorically that:
"...the conveyancer must ensure they have not been appointed as the result of pressure having been exerted on their client."
It is your conveyancer’s responsibility to make sure you have not been coerced. Any potential conflicts of interest must be disclosed to you. In reality, this is difficult to practically define and police.
Check the solicitor's lender panel status
Your chose solicitor will also need to be able to act for your mortgage lender. Not all solicitors can act for all lenders. If your solicitor is not on your lender's panel you can expect major delays.
The agent will not be aware of the solicitor's lender panel status.
Why do so many buyers and sellers use the agent's recommended solicitor?
Most buyers and sellers do not think about the legal process until an offer has been accepted. The agent will pass the offer on to the seller and, if accepted, the agent will ask for the seller's solicitor details. With no time to start shopping around, it is easier to accept the agent's recommendation.
The agent will also contact the buyer at this stage and ask for their solicitor's details.
Instruct a solicitor as soon as you put your property on the market
The best time to instruct a solicitor is just after you put your property on the market. Much of the preparatory work can be completed before you find a buyer and this can shave weeks off the conveyancing process.
Buyers can also benefit from this approach as they can be set up as a client and all of the initial formalities completed before they have an offer accepted.
As most solicitors work on a no move no fee basis, it really is a no-brainer to get the legal process underway as early as possible.
This also gives you time to shop around for the best deal from a solicitor you feel confident in.
How can Quittance help?
If you are buying, selling, remortgaging or transferring equity in a home, our panel of expert conveyancing solicitors can help.
We aim to deliver a stress-free moving experience. We focus on proactive communication to help drive your sale or purchase forwards.
- No Move, No Fee Guarantee
- Fixed fee conveyancing service
- CQS-accredited panel solicitors
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