CML releases response on Scotland sep rep
The Council of Mortgage Lenders (CML) has urged Scottish solicitors to reject their proposal to introduce mandatory separate representation.
The Law Society of Scotland (LSS) will be voting in September on a potential law change that will make it mandatory for lenders and buyers in the same property transaction to be represented by separate solicitors.
The CML said that in the vast majority of cases, joint representation of lender and borrower is more efficient, cost-effective and more clearly in the consumer interest.
They argue that a rule change is a disproportionate response, and have raised a number of concerns on the subject. One is that the Scottish position is in stark contrast to the Law Society of England and Wales position.
They also raised several concerns around the way the consultation document has been written, arguing that it has not been written in a balanced way as well as failing to accurately present the views of the CML.
If the LSS members do introduce mandatory sep rep the CML think an implementation period of at least 12 months or more will be necessary in order to avoid transition problems.
CML director-general Paul Smee said: “In the vast majority of conveyancing transactions, where the interests of the borrower and the lender are very closely aligned, we fail to see how mandatory separate representation can possibly be in the consumer interest.
"Given that existing rules already provide for separate representation where conflict of interest does arise, we urge the Law Society of Scotland to think again.
“We continue to invite constructive engagement with the LSS to review and, if necessary, refine the Lender’s Handbook to ensure that both lender and borrower clients’ interests are properly protected."