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Shock figures show ‘hidden’ conveyancing fees deter buyers

A digital conveyancing platform says a lack of transparency in the house moving process - particularly regarding legal costs - is deterring buyers and sellers.

Research amongst 2,003 people by the platform When You Move, and shared exclusively with Estate Agent Today, shows that when fees for estate agents, surveyors and others are combined they cost £8,113 more than the typical buyer expects when purchasing a home.

Some 28 per cent of buyers say they would have pulled out of their purchase had they appreciated beforehand the full scale of the charges, while 20 per cent have had to turn to family or friends to help cover the transaction charges.

And a third of those questioned say they lost a chunk of the money they had saved for a deposit on fees that they had not budgeted for.

However, the platform reserves its strongest criticism for conveyancers and their costs.

Some 25 per cent of respondents say their solicitor “misled them” in relation to the true extent of fees 

Broken down by age, the buyers aged 18 to 34 say the unexpected legal costs added up to £2,823. Amongst those Agent 35 to 54, the cost was £9,498 of additional fees they apparently had not expected.

Overall 58 per cent of respondents in the survey said they were ‘stung’ by higher than expected conveyancing costs of between £1,000 and £4,000; some 14 per cent felt the additional fees were between £5,000 and £10,000.

Some parts of the conveyancing industry are addressing transparency issues as soon as early next month, with members of the Council for Licensed Conveyancers agreeing to put some price and service information on their websites and in other media from December 6

The CLC has already published templates and examples of displaying cost information for both conveyancing and probate work. 

Firms are able to decide the best way to display cost information, such as examples of fixed fees based on specific values or a range of values of properties, hourly rates of members of staff with indicative timescales for transactions, or through instant estimate generators.

However, the CLC cautions that any estimate generator should produce an instant result directly to the consumer. “A consumer shouldn’t have to provide contact details to receive a call-back or email for an estimate” the guidance says.

Meanwhile When You Move says it is launching a new tool for agents to install on websites offering what it calls “a quick and accessible service for consumers to use when they are searching for the costs of a conveyancing firm.”

The platform says the tool - QuickQuote - “eradicates the opaqueness shrouding UK conveyancer fees by ensuring all final costs are presented for evaluation at the beginning of the solicitor selection process.” 

  • Rob Hailstone

    I'm confused by the different terms being used:

    Legal costs
    Additional fees
    Conveyancing costs

    "Unexpected legal costs added up to £2,823. Amongst those aged 35 to 54, the cost was £9,498 of additional fees they apparently had not expected."

    Most conveyancers charge less that 1K for a sale or a purchase, so anything 'unexpected' over 2K has to be a 'disbursement', i.e. a payment made by the conveyancer to a third party.

    "Some parts of the conveyancing industry are addressing transparency issues as soon as early next month."

    No, all parts, firms reregulated by both the CLC and the SRA will have to have clearer pricing and transparency on their websites next month. Possibly including who they pay referral fees to and how much those referral fees are. Could get interesting!

  • Peter Ambrose

    As ever - bang on the money Rob.
    This piece just exposes how confused buyers and sellers are as to what are actual costs.
    A recent mystery shop of online lawyers revealed that the average quoted fee for buying a £500K freehold property with a mortgage was £350 Inc VAT.
    The real shock should be the amount of bribes that buyers and sellers are paying through panel managers to facilitate the provision of the mutton quality service dressed up as lamb.

  • icon

    Hidden conveyancing fees are nasty and they are rife. Seek a guarantee of no extra charges!

    The hidden/buried charges come about because some conveyancers will choose a very low looking price say they charge, and then within their terms of business they inbuild an ability to charge (being the conveyancers own charge ..their own profit) for things that will inevitably always crop up, and which other firms instead include at the start in the their more realistic looking fee.

    Indeed the ‘things’ that can be charged extra for can mount up so fast and be so costly.

    Like what?

    - filling in a stamp duty form
    - acting for a mortgage company (when you have already told them you are having a mortgage)
    - compulsory ID check admin fee
    - sending you proof of the registration of your property on your purchase (seriously!?)
    - a charge for every enquiry the lawyer raises of the selling lawyer on their paperwork - yes seriously that exists, talk about a blank cheque
    - checks against another lawyer’s bank details to make sure your lawyer does not send it to a fraudster
    - acting in unregistered land (seriously!?)
    - discharging a mortgage
    …the list goes on (I bet other posts will name some more)

    NOTE: The worst one I know is where the conveyancing business says "IF your mortgage offer gives you a friendly reminder not to forget your lawyer is charging you a conveyancing fee, and even gives an example of what that is …..whatever the amount in the example…..then we can claim that example sum as a fee too" - yes, seriously !????

    But imagine one step further. Imagine if a conveyancing business then finds an estate agent or an estate agent chain and offers them a cash bung, so high the agent does not care or enquire about the quality of the conveyancing, meaning the conveyancing business now has guaranteed customers on tap….now imagine how profitable the extra charges could work out being…how tempting to keep adding to the list above…..and how rife they would become across the country.

    None of the above sounds nice does it…..so pick your conveyancer carefully, or your ‘cheap looking fee’ could end up sky high, when it is too late to do anything about it.

    Cheap looking conveyancing is cheap for a reason.

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