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Free legals

ended 16. May 2022

A journalist at Mortgage Strategy is looking for quick views from mortgage brokers and conveyancers on free legals being offered on remortgages. For example, are they a worthwhile benefit that people remortgaging should take advantage of, or should they be avoided at all costs (there is a lot of frustration in the broker community)?

4 responses from the Newspage community

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Rob Peters
Principal at Simple Fast Mortgage
"Lenders' free legal services are much like spotting a gold coin on the floor, but realising it's wedged in a pile of dog dirt. While, on the one hand, there is a monetary benefit to a gold coin, you accepts that you will have to wade through a pile of poop to get it. This creates a dilemma for advisers who should usually be recommending the most cost-effective solution for their clients in order to justify 'suitable advice'. Thankfully, many lenders also offer the option for cashback instead of free legal services. Where available, we recommend our clients taken this option, and we use the cash to cover the cost of an alternative legal service which we can retain control over."
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Jamie Lennox
Director at Dimora Mortgages
"Free legals are both the best and worst thing available to customers when remortgaging. The principle of allowing the customer the ability to switch providers without any legal costs removes a huge barrier for clients who may not have the spare money to cover these additional charges. However, the experience received is in the lap of the gods and will depend massively on what firm is allocated to the client. We see some great examples and some truly shocking ones and often find we are having to go above and beyond to get these cases across the line."
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Imran Hussain
Director at Harmony Financial Services
"Free legals are pretty much the carrot and the stick as they allow people to remortgage to another lender without the burden of extra costs or expenses but in my experience the vast majority of times it means, due to the sheer volumes the firm taking this type of business are taking on, any form of service the client expects is gone. It's all automated and email only, and if you dare to call them expect half the day on the phone just waiting for someone to answer. So if the lender offers any cashback, take it and find a local solicitor."
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
"Free legals are a great a great idea in theory, convenient, one less thing for a client to think about, but in practice they are generally very poor for anything other than a straight forward like-for-like remortgage on a standard property. This has been a long-running issue for mortgage brokers, who are generally the people who have to do the extra legwork to make up for the poor quality of the free legals and actually get the deal done. Not that I can blame the legal services firms to be fair. They have been repeatedly battered down on price by lenders and so are working for far less than their normal fee, to the point where there are then only a few really large players that actually service the market. The result is that they are then far too busy to offer any form of personal, quality service to the customer. I think we are getting to a point where lenders are going to have to rethink the free legal service, because the poor experience that the client has reflects on the lender and their brand. No one remembers the name of the legal service that got used, but they do recall they had a shocking time remortgaging with such and such a lender."