Earlier this year, fintech company Shieldpay and Premier Property Lawyers completed the UK’s first fully digital mortgage settlement. Premier Property Lawyers is regulated by the Council for Licensed Conveyancers (CLC), which supported the trial.
Last week, we were delighted to welcome into the studio representatives from all three organisations for a webinar on digital escrow. Stephen Ward from the CLC introduced Geoff Dunnett of Shieldpay and Rob Gurney from Premier Property Lawyers, and our three guests explored some of the challenges in the current conveyancing process, explained the trial and considered some of the benefits digital escrow could bring to property transactions.
You can request free access to a recording of the webinar here.
One very clear benefit of digital escrow (also referred to as Third Party Managed Accounts) is to remove completion day uncertainty. Currently, the purchaser must wait around for confirmation, via their and the seller’s lawyers, that funds have been sent and received. Then they must arrange with the estate agent to pick up the keys, and then at long last the moving-in can begin.
Shieldpay’s solution enables the exact completion time to be set in advance, with all stakeholders receiving instant notification once funds have been received, the transaction has completed and keys can be released. It’s not difficult to see what a difference this would make to clients in a lengthy chain on moving day.
For lawyers, the most notable upside is likely to be in fraud-prevention. ‘Friday afternoon fraud’ is a worrying phenomenon for conveyancing firms, and a service such as Shieldpay’s provides an extra layer of security in doing ongoing checks on the authenticity of bank details. This removes a burden from the solicitor, and the commensurate risk reduction is likely to be of interest to professional indemnity insurers.
The CLC, having supported the trial, unsurprisingly welcomes the use of digital escrow in conveyancing. It is seeking to understand how it can work and what guidance it can provide to firms to give greater confidence in adopting TPMA. In 2017, the Solicitors Regulation Authority (SRA) updated its ethics guidance to confirm that firms may use TPMA but must notify the SRA.
To watch the free webinar and find out more about the digital escrow trial, visit https://www.clt.co.uk/webinar/digital-escrow-in-conveyancing-ondemand-webinar/
The Council for Licensed Conveyancers has been supporting trials of a digital escrow system for the transfer of funds in property transactions that could make those transactions more secure and reduce the uncertainties of the completion day and time, improving the client experience. The trials have been carried out by Shieldpay, a fintech company, and Premier Property Lawyers, who are regulated by the CLC.