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Independent legal advice is necessary for your protection, to ensure you can enforce your security in the event that the borrower defaults on their mortgage. Inadequate advice could cause you problems in the event you do need to enforce your security. You can be confident that the advice provided by ILA Direct is comprehensive to minimise the risk to you.

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Benefits of ILA Direct for Mortgage Lenders

Fast, Flexible, Professional, Secure:

Independent legal advice is often essential to ensure that your security is enforceable. If advice is not properly provided, you may not be able to recover the sums owed. 

There are many cheap online firms routinely offering independent legal advice via video conferencing and the feedback we have received is that the advice is provided in a matter of minutes, with little effort being made to really understand the circumstances of the person receiving the advice. 

In the event the advice provided is insufficient, whilst you may have a claim against the firm that provided the advice, it could take many years to recover the sums owed to you. That is why it is important for advice to be given face to face, by solicitors experienced in the area on which they are advising. 

Should you accept advice provided via video conference: 

Almost all lenders require advice to be provided on a face to face basis and there is an extremely good reason for this.

 

It is essential that any individual providing security for a debt is not being subjected to undue influence. If they are, the security may not be enforceable. This is one of the main reasons independent legal advice is required.

 

The person receiving the advice must be able to openly discuss any concerns with their advisor and they must feel comfortable instructing the advisor if they do not wish to proceed. However, if the person receiving the advice is not alone at the time the advice is provided, there is a risk they may be subjected to undue influence, preventing them from speaking freely. 

It is therefore essential that the person receiving the advice is alone at the time the advice is being given, and the only way to ensure that they are alone is to meet with them face to face. This is why it is dangerous to rely on cheap online providers who give advice via video conferences, as there is no way for the advisor to be certain that the client is alone.

 

You may think this is unlikely to be an issue but we have witnessed first-hand the lengths a borrower will go to in order to influence a guarantor. On one occasion, we were made aware after providing face-to-face advice that the husband of our client had in fact been listening to the entire meeting using a hidden mobile phone, possibly preventing our client from speaking freely and potentially influencing her instructions to us.

Ensuring advice is independent:

In Royal Bank of Scotland v. Etridge, Lord Nicholls stated that "the Solicitors task is an important one. After formality. 

 

The Law Society take the view that "To comply properly with the House of Lord's judgment guidance is likely to take several chargeable hours". It is therefore concerning that many online providers of independent legal advice offer appointments of no longer than 15 to 30 minutes, which in our view, and that of the Law Society, is not sufficient and could leave lenders at risk.

 

At ILA Direct we take the time to get to know each client and to understand the individual circumstances, so that we can adapt our advice accordingly, ensuring that our client, fully understands the consequences of entering into any agreement, thus ensuring the bank can rely on and enforce its security should it need to do so.

 

ILA Direct offers all the benefits of an online firm (speed, flexibility, affordability) but our advice is provided face to face.

Should you accept advice provided by an online firm?

In the House of Lords case of Royal Bank of Scotland v Etridge, the Court contemplated that the same solicitor could, in some limited circumstances, act for the borrower, the guarantor and the lender in an administrative capacity. However, lenders should consider very carefully whether it is appropriate for solicitors to do so.

The Law Society considers that “The risk of conflict is extreme when attempting to reconcile Lord Nicholls’ comments concerning the provision of full information with a client who in many cases may not wish for the documentation to be fully explained”

In our experience, when the third party realises that their home may be at risk, questions often arise and there may be some reluctance or hesitation to proceed. On occasion, the most appropriate advice may be not to proceed with the guarantee (even though the guarantor may wish to proceed in any event) and in such cases, this would clearly be a conflict of interest for the solicitor attempting to advise all parties.

For a solicitor to proceed with advice, where such conflict does exist, may result in the security being unenforceable and we would therefore caution any lender to think carefully before authorising their own solicitor to provide Independent Legal Advice. 

Security:

When dealing with sensitive personal information, data security is of paramount importance.

 

At ILA Direct all documents will be stored in our cloud-based case management system, approved by the Law Society of England and Wales, on servers located in the UK.

 

Our clients can access their documents at any time via our fully encrypted and secure client portal.

If you are a Solicitor, Mortgage Broker or Mortgage Lender?

If you are a solicitor, mortgage broker or mortgage lender, you can find out more about the specific benefits of referring your clients to ILA Direct by clicking on one of the following buttons below...

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