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Homeowners paying £765 million too much in legal fees

Published: Wednesday, 25th July 2012

The typical move for a homeowner will involve legal costs for both the sale of their old house and the purchase of their new one.  And if they use a traditional high street conveyancing solicitor then, on average, they’ll pay almost twice what it would cost them if they went online.


Undercover survey


This surprising figure comes from a survey by online estate agent  House Hop conducted an undercover survey of 52 randomly chosen high street solicitors and compared their quotes to those from House Hop’s own panel of online solicitors.


Each solicitor was asked to provide a quote for an identical transaction involving the sale of one property and the purchase of another.  The quotes were for average priced houses (since solicitors often base their fees partly on a property’s value).


Save £850 online


The result:  the average cost (excluding search costs, which are fixed2) of a high street solicitor was £1745 compared to a cost of just £895 if you go online.  That’s a saving of £850 (48.7%).


With the number of residential property transactions likely to complete this year being around 900,0003 that represents a potential overpayment by homeowners of £765 million.4


End of the "high street monopoly"


So why is going online so much cheaper?  Quite simply the internet has thrown open the gates of competition.  In the old days there was a virtual “high street monopoly”.  Homeowners were forced to choose from a tiny handful of local firms all of whom charged similar (high) prices.  Today conveyancing can be done from anywhere in the country and so competition – at least in the online sphere – has forced prices down. 


According to John Tighe, the founder of House Hop and a lawyer himself, “consumers can now benefit from online access to firms specialising in conveyancing and who have much lower overheads, the benefit of which they pass on to their clients.”  This makes them far cheaper than their high street counterparts who may only do a handful of conveyancing transactions and whose costs per lawyer work out far higher.


Beware online "law factories"


This is great news for consumers, but a word of warning:  not all firms offering online conveyancing are equal.  Some have been described as “law factories” – essentially no more than legal call centres where underpaid (and sometimes under qualified) staff are simply unable to give the kind of service you would expect because they are too busy.


Too busy, it turns out, because the firms they work for sucker in large numbers of clients by offering ridiculously cheap headline prices (£99 is not unheard of).  Of course, these prices later turn out to be completely bogus.  They don’t include any of the many “expenses” that such firms use to pad out their bills.  Nor do they include search costs, registration fees or VAT.


The result is overworked and unhappy staff and frustrated customers who end up with a final bill that is many hundreds of pounds more than they expected and for a second rate service.


The 4 steps to choosing a solicior without getting "ripped off"


So is it possible to benefit from the much cheaper online competition without getting caught out by an online “law factory”?  The answer, according to John, is to look for an online firm that meets these four criteria:


1.  Find a “conveyancing specialist”


Your solicitor should have an established reputation and specialise (or have a department specialising in) conveyancing.


2.  Get a “fixed fee” quote


Never hire a solicitor on a per hour basis.  This is how costs skyrocket. And don’t accept a quote that is fixed fee providing that there are no “unforeseen complications”.  Such a promise is not worth the paper it’s written on:  “fixed fee” should mean exactly that.


3.  Get a “complete” quote


A fixed fee quote is no good unless it includes all costs.  A favourite trick of dodgy firms (both online and high street) is to give low headline quotes to get your business and then add on lots of expensive hidden extras.  Your quote should include all disbursements (expenses) plus VAT.


4.  Get a “no completion – no fee” quote


As many as 1 in 3 property transactions fall through, meaning that one of the biggest unexpected costs when moving is additional legal fees.


To protect yourself against this find a solicitor who will work on a “no completion – no fee” basis.  That way if you can’t complete you will be spared the legal fees (though you will still have to pay any expenses that have already been incurred on your behalf).


So, these are the four criteria for finding a good online conveyancing solicitor.  All very well, but how can you be certain whether they’re in the good category of competitively priced conveyancing specialist or the bad category of cheap “law factory” without doing lots of exhaustive research?


Getting the right conveyancing firm


The simple answer is to find someone who’s already done the work for you.  This is where House Hop’s panel of conveyancing solicitors comes in.  All the solicitors on the panel meet the four criteria set out above.  In addition they’ve all agreed to maintain a high level of customer service, all are members of the Law Society and all are regulated by the Solicitors Regulatory Authority.  They also guarantee that when you get a quote through YouMove it will be cheaper than if you approach the solicitors direct.



As an added reassurance, House Hop make unedited customer feedback on each firm available on their website – feedback that comes direct from clients and so can’t get filtered by the firms themselves.  In fact, House Hop have already dropped two firms from their panel because the standard of customer feedback was not high enough.

Click Conveyancing Quotes to compare instant quotes from House Hop's panel of online conveyancing solicitors.

1 Survey of 52 high street solicitors for sale and purchase of identical properties.

2 The figures exclude the cost of the following searches: Local Authority; Water and Drainage; and Environmental.  The cost of these searches is fixed for any given property since they are set by the local authority and the local water company.  Typically, the cost of these searches adds up to around £200.

3 HMRC website

4 900,000 x £850 = £765 million

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*£850 is the average saving on a typical sale and purchase through our panel of conveyancing solicitors compared to using a high street solicitor (Survey of 52 high street solicitors, September 2010).