With the number of mortgage approvals down 41% from a year ago and no sign of any end to the credit crunch, conveyancing departments are beginning to feel the pinch. Ironically, the economic downturn may in itself produce work for those firms prepared to invest in IT and staff training.

With mortgage and loan repayments costing more and several million borrowers about to come out of their fixed rate deals, homeowners are looking carefully at their paperwork and many are discovering problems.

It seems that in the rush to sell, some brokers may have not been up to speed with their paperwork and may have failed to disclose fees or miscalculated loan interest rates. Worse still, many consumer credit 'cooling off' letters were not sent and other Consumer Credit Act safeguards not complied with. All of this adds up to a mess for many loan and mortgage providers with borrowers looking to recoup charges or sometimes get out of deals altogether.

Many conveyancing departments faced with falling numbers of property instructions are converting their systems and staff to handle these type of claims. Although the claims for secret profits or breach of the Consumer Credit Act are litigation in nature, the claims involve issues [and paperwork] familiar to all conveyancers and so shifting fee earners to credit claims rather than creating redundancies may be the logical solution to law firms.

A new breed of referrer is also appearing, offering a genuine deal for clients with many providing solicitors work at no up front cost. It now seems likely that this will be a future growth area.