News Review: Referrals
Don’t be caught short of a conveyance by
David Gilman, partner, Blacks Connect
Te conveyancing sector is currently experiencing a much-needed
correction,
with firms closing down leſt, right and centre. Te So- licitors Regulation Authority says more than 250 law firms have stopped conducting business since the start of the summer alone, and experts cite the subdued conveyanc- ing market as one of the main reasons for this. It’s not surprising that a
combination of low volumes and lenders culling panels has simply proved too much
for some law firms that deal in conveyancing. Te market needs to consolidate – and it is doing. Smaller firms are leaving the market and the bigger players are getting big- ger. But how does that affect brokers? And if you have an existing relationship with a conveyancing firm, what hap- pens if they close down?
Pipeline business Firstly, don’t worry. Law firms are not like mortgage net- works and you won’t be leſt high and dry when one closes down. Tey usually take a few months to wind up – at least – so you are not going to be stuck with pipeline business and unpaid referral fees. But if a business goes under that you have had a long-term re-
lationship with, you are going to be under pressure to find a new partner so you don’t miss out on those important refer- ral opportunities. In this mar- ket you need to be making the most of every client.
Cutting corners Tink carefully about the firm you are going to entrust your clients to, because it is oſten the skill of the conveyancer that can make or break the property chain. You probably – and hopefully – trust the conveyancing firm you cur- rently use to do the job prop- erly for your client. Aſter all, it’s your reputation at stake, because when a conveyancer cuts corners the consequenc- es can be very serious. If they do close down, make sure you
are equally comfortable with whichever firm you choose next time. Check that they do sufficient volumes to have up-to-date experience of the market and, crucially, to avoid getting cut from lenders’ pan- els.
Qualiity service If you are worried about the stability of a firm you have been referring business to, start to look around now. Try referring a couple of cases to a new partner to test their service but look for qual- ity of service and experience above attention-grabbing fee discounts and referral incen- tives. Because, as brokers know better than anyone, the best deal for your client isn’t all about the headline rate.
Partner local estate agent for a shared referral by
Harpal Singh, managing director, Broker
Conveyancing.
co.uk
Brokers can be so deluged by suggestions that they should diversify or offer auxiliary products and services that there can be a temptation for them to not only feel over- whelmed, but to question what is really in it for them if they widen their remit. When it comes to conveyancing, the two main benefits are imme- diately apparent. Not only can they earn a sizeable fee, but they can also assert greater control over the whole pro- cess.
Tis control is afforded by
the online tracking systems that many conveyancers use. If brokers have offered their clients the opportunity to use such systems, then they will be able to check how the case is progressing on their behalf. As well as this clearer com-
munication, intermediaries will also be remunerated for their referrals. On a purchase transaction, brokers can usu- ally expect to receive around £200 and on remortgages it is usually around half
this.
With proc fees continuing to shrink, this can represent a significant boost to what bro- kers earn from each case.
Dream home It’s not rocket science to work out when brokers have the opportunity to claim a client’s
16 MORTGAGE INTRODUCER OCTOBER 2012
conveyancing business, espe- cially on purchases. Whereas traditionally a lot of house buyers would have found their dream home before ar- ranging finance,
it is now
far more common for indi- viduals to ascertain what they can borrow before they go house hunting. Brokers needn’t put the hard sell on their clients, but can simply suggest they provide them with an obligation-free quote and they are free to decide from there. If the interme- diary is the first port of call for the borrower, then they have the perfect opportu- nity to beat their rivals for the conveyancing business to the punch. With remort- gage cases it isn’t quite as cut and dried, particularly as a
lot of lenders offer free legals or cashback offers to pay for such costs, but shrewd bro- kers can still stake their claim.
Shared referral It needn’t be a case of brokers competing against estate agents for convey- ancing referrals either. Bro- kers not wishing to miss out on any cases could always partner with their local estate agent by suggesting a shared referral arrangement whereby both parties can benefit from each case
they place with
a conveyancer. It is just this type of creative solution that is allowing savvy brokers the opportunity to earn rather more from each advised client than just the mortgage fee.
www.mortgageintroducer.com
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