Estate Agents and Solicitors
Estate agents quite often suggest to buyers and sellers that they should use particular solicitors for their conveyancing even though that solicitor might not be local and might even be at the other end of the country. They will say that the particular solicitors are known for their speedy response and willingness to achieve a fast completion.
But do they mention the real reason? In many cases a fee is paid by those solicitors to the estate agent to obtain that work.
This of course is legal provided certain strict procedures are followed by the solicitor and the estate agent.
How does the general public feel knowing that the solicitor has paid ‘to get them’. To whom does that solicitor owe his ultimate allegiance – the client for whom he is acting or the estate agent who sends him work?
The general public will more
The general public will more than likely be unaware of this and it does make you think about conflicts of interest for the Solicitor. With the public ultimately paying the referral fee, it's not exactly consumer friendly. Here's a link from estate agent today regarding this very issue;
http://www.estateagenttoday.co.uk/News/Story/?title=Law%20Society%20moves%20to%20outlaw%20referral%20fees%20to%20agents&storyid=2578&type=news_features
www.chadwickhomeinspections.co.uk
In the current climate of
In the current climate of transparency, openess and consumer choice it is certainly questionable as to whether referral fees should be allowed. Many buyers and sellers are not aware that the only reason a particular firm of solicitors is recommended by an estate agent is because the agent is being paid for that recommendation.
These solicitors are effectively "buying" work and this must ultimately affect their impartiality which is detrimental to their clients.
I am a Legal Advisor employed by Sarginsons Law and specialise in Civil Litigation matters. I deal with disputes between individuals and businesses including Landlord and Tenant issues, debt recovery and property disputes.
Telephone 02476 553181
Referral fees are really just
Referral fees are really just a symptom of capitalism - the exploitation of the weak by the strong.
In my field of work the estate agent controls the house buying and selling process from the start and extracts money from all participants at all stages.
The Law Society wishes to make referral fees illegal.
I believe they will be successful but there are other ways to collect this money.
For instance I received a visit recently from a representative of an organisation which promised to send me clients. No referral fees were involved but he wanted a payment of 6000 pounds as a membership fee to his organisation.
If you cannot beat them then you have to join them.
Sooner or later we will have to open our own estate agency.