Hands up all members who have actually seen a lender withdraw a loan offer to clients after a decision in principle has been given. It seems to the writer that the whole of the Scottish legal profession is being held in thrall by an anecdote sweeping the nation that this happens more now than in the past.
Conveyancing practice is being held up, and countless additional hours are being wasted on the telephone chasing bargains by seller’s agents desperate to know whether the purchaser has finally decided they are creditworthy in the eyes of some dilatory lending institution.
In truth, the system as previously practised was that the agent for the purchaser had to decide with their client that they were creditworthy before putting in an offer. Then any offer was supposed to contain any suspensive conditions such as any condition about finance. The parties entered into quick and sensible contracts which rarely fell through, and hence there was no need to introduce the English practice of deposits.
Is it the introduction of defensive conveyancing centralised in the hands of those more interested in reducing fees than providing a service, or that the herd mentality tends to the lowest common denominator (assisted in some parts by a buyers' market), which means that nothing gets done until a loan offer appears? Indeed, agents seem rather surprised when a cash buyer is preferred, and tend to suggest gazumping. Not so: it is simply the application of normal commercial principles to people who don’t tell the whole truth in their offers.
Meantime an impatient public will point the finger of blame in only one direction – i.e. those too apathethic to enforce change and demand honest offers.David Johnson, Johnson Legal Solicitors, Edinburgh