A call to simplify the CML Mortgage Code
David Knapp, Partner and head of residential property at law firm Hart Brown, calls for a simplification of the relationship between solicitors and mortgage lenders.
In what now seems a dark and distant past a good number of providers of residential mortgages put their heads together and in 1997 introduced the Council of Mortgage Lenders handbook.
The aim of the handbook was to provide a standard process for solicitors when dealing with mortgages. In essence the aim was to make life simpler due to the huge number of different requirements that each lender placed on to solicitors.
Between 1997 and 2004 the CML Mortgage Code existed as a voluntary system of regulation but thereafter became mandatory.
Some 20+ years on we have unfortunately found ourselves in a worse position than we were in the mid 1990s.
Slowly but surely the “standard practices” for those lenders who are members of the CML have been eroded. Part II of the handbook was introduced laying down the extra requirements of individual lenders who each have their separate part II handbook.
Subsequently various lender panel sites sprung up starting with Lender Exchange followed by LMS and ULS Technology. Each of these have their own requirements on behalf of their own lender members with different requirements and obligations imposed on solicitors on top of Part II of the handbook. In the case of LMS and ULS we, as solicitors, have to collect a fee from our clients to pay these sites for each transaction that involves one of their lender members. God forbid that one misses a deadline imposed on us which results in a further fee and a threat to remove you from their site with untold consequences.
Perhaps it is time for the CML to once again go back to introducing a standard handbook and one panel administrator rather than having various organisations.
To add to the frustration LMS and ULS charge a fee to process that work that solicitors do on their behalf which is passed to their borrower. As the sites are presumably there to save the lenders costs in their administration it seems unjust to charge a fee that ends up with their borrower to pay.
To muddy the waters even more not all lenders are part of the CML.
Can a fresh policy please be introduced to go back to the aim of simplifying the solicitor/lender relationship to ensure that we a method of working for all lenders that is acknowledged as being consistent for all?
Kindly shared by Hart Brown