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An important amendment is be made to to clause 10 of the CML Lenders’ Handbook on 1 February 2016. The amendment will insert an additional sentence into clause 10.2 as follows: (additional wording in bold) 10.2 We shall treat the submission by you of the certificate of title  as confirmation that the borrower has chosen to proceed with our mortgage offer  and as a request for us to release the mortgage advance to you. Check part 2 to see if the mortgage advance will be paid electronically or by cheque and the minimum number of days notice we require.  The amendment is designed to reflect the introduction of a requirement, as the result of the Mortgage Credit Directive, for mortgage customers to have a ‘reflection period’, of at least seven days before accepting a mortgage offer. Recital 23 and Article 14(6) of the Directive set this out. The customer can bring that reflection period to an end earlier, by accepting the mortgage offer. The wording intends...

Skipton Building Society have made a recent change to P2 of their CML Handbook. The change was to Section 4.1 The old wording was : The Borrower should provide you with a copy of the valuation. If not, you can obtain a copy from the Completions Team The new wording is: We provide a copy of the valuation to you in most cases. If not attached to your instructions, please obtain a copy from the Completions Team This change seems to reaffirm the P1 obligation to have sight of and check the valuation report. It’s very easy to assume that if the lender does not send a copy of the valuation that you are not obliged to check it. It’s nevertheless very important to remember that  regardless of where the report is obtained from, you must carry out the checks detailed in sections 4.2 and 4.3 of the Handbook which read as follows: 4.2 You must take reasonable steps to verify that there are no discrepancies between the description of the property as valued and the title and o...

In the 2015 Autumn Statement, George Osborne announced higher rates of stamp duty on the purchase of additional properties, such as buy-to-lets and second homes. The government is currently consulting on the practicalities of how the 3% stamp duty hike will work and is seeking responses from conveyancers. The deadline for the consultation is 1st February 2016 in order for the government to announce the new regime in the upcoming Budget. Conveyancing lawyers are asked to respond to the following questions: Do you think that purchasers are more likely to give accurate answers to main residence questions if HMRC provides specific questions for the conveyancer to ask the purchaser? Would a formal declaration by the purchaser that the answers to any such questions are accurate help to increase compliance without creating undue burdens for conveyancers? How do you think such a declaration should work? Besides normal publicly available guidance, are there any additional products that...

Conveyancing transactions in England and Wales got more complicated in 2015 as lenders more frequently introduced complex changes for conveyancers, a year-end review of The Council of Mortgage Lenders Handbook by Lexsure Ltd. shows. The London-based software house helps solicitors better manage their firm’s risk via tools such as LENDERmonitor and COMPLETIONmonitor . Even though the U.K. remains strong, mortgage lenders are being more cautious in their policies, regularly introducing changes that make it all the more important that solicitors are aware of particularly onerous terms that an individual lender may impose According to Lexsure’s review, 75 % of CML lenders amended their Part II policies last year, with over 250 sections changed.  Some of the more frequent changes focused on problematic properties such as flying freeholds, properties with absentee freeholders as well as properties with short leases. Of notable concern is that 12% of lenders changed their minim...

CML Lender Kent Reliance (a trading name of OneSavings Bank plc) has kick-started 2016’s CML Handbook changes with amendments to eleven on it’s Part 2 sections. In changes which are consistent with predictions and trends identified in Lexsure’s 2015 Market Complexity Review ,amendments were made to the following sections: 5.4.6- Does the lender accept search insurance and, if yes, what are the lender's specific requirements? 5.7.1a- Does the lender lend on flying freeholds? 5.7.1c- If the lender is prepared to accept a title falling within 5.7 and the property is a freehold flat or flying freehold , to which contact point must this be reported? 5.14.1- What minimum unexpired lease term does the lender accept? 5.20.1- Does the lender require me to report to them where the lease does not meet the CML minimum requirements for leases of roof space for solar PV panels? 5.20.3- Does the lender have additional requirements relating to leases of roof space for solar PV pa...

‘Friday afternoon scams’ continue to be on the increase and cybercrime is set to be one of the hot areas of risk for conveyancing firms in 2016. Such scams may involve fraudsters hacking into a law firm’s systems.This could apparently be done by the simple expediency of sending an seemingly trustworthy email with an attachment. Once clicked, this downloads malicious software and allows the thieves to intercept emails, send emails of their own using fraudulent addresses, divert huge sums of money and stop completions going through. It’s called Friday Fraud because they know the best time to hit is on a Friday, the busiest time for conveyancing, when employees may be less alert to fraudulent approaches. What should a conveyancing solicitor do if a client provides new bank account details part way through a transaction? With these types of fraud on the increase, a client providing new bank account details should raise an immediate red flag. If this happens, solicitors should ...