An individual client is often required to obtain independent legal advice (or “ILA”), from an independent legal adviser, in respect of their transaction documents. Usually, the solicitor, legal executive or licensed conveyancer, will provide a signed certificate stating when and where they provided the impartial advice. If a dispute arises regarding the documentation, the solicitor may be called upon to confirm that independent advice was provided and the correct process was followed.

Increasingly, some law firms don’t want to provide independent legal advice to clients, often seeing it as a hinderance, but we are happy to help.

Why do I need independent legal advice?

If you have ever read through a mortgage document, you will know that the lender has serious powers in terms of what it can do if payments are not received as and when they are due.  Most people, however, wouldn’t read such documents, and lenders therefore require borrowers and related parties to obtain ILA. This ensures that borrowers have a proper understanding of the risks involved with taking on the loan concerned.  The benefit to the lender is that you cannot then claim that you were never told what you were signing should a dispute arise down the line.  

Much of this area of law concerning mortgages spans from the case of Royal Bank of Scotland v Etridge, following which courts agreed that borrowers for a mortgage should be advised to seek independent advice before signing documentation. This helps prevent unscrupulous family members taking advantage over vulnerable parties, as well as the risk from potentially unscrupulous lenders.

The benefit for you as an individual is that you understand the risks.  It may be that following the provision of the legal advice, you choose to reconsider your banking, and perhaps seek a better arrangement elsewhere i.e. with another lender who may not require so much security for example.

When do I need Independent Legal Advice?

There are many transactions where you will be required to obtain independent legal advice before funds will be released.  Regular examples include:

  • Loan security – where you own a property or land, and a tenant (perhaps your company) is offering this as security to a lender
  • Personal guarantees – often called PGs, these are relevant where you are guaranteeing a family member’s loan or mortgage, purchasing a property through a limited company, getting a commercial loan, or perhaps extending your commercial overdraft facility
  • Occupier’s Consent Forms – where you occupy a property but are not a party to the mortgage documents
  • Gifts – where you are providing a gift to a family member to purchase a property, the lender may require you to confirm it is a gift rather than a loan, and that you are waiving your rights
  • Local legal advice – where the solicitors acting on your behalf are too far away to meet with you directly, you may need to find a local advisor to see you in person

Our ILA process

We try to make obtaining independent legal advice a straightforward process, and it shouldn’t take too long to complete:

STEP 1:  Give us a call or drop us an email enquiry so that we can get you set up as a client and book in your appointment, it is also really helpful to have the papers sent to us in advance of your meeting so that we can read through it and make sure there are no unexpected steps required.

STEP 2:  Meet face to face with one of our lawyers to go through your paperwork together, and to obtain the ILA. Depending on the lender, it may be that this can be done online, but generally face to face “in person” is still preferred by many lenders (and the personal touch, with a cuppa is nice!).  This is your chance to ask us any questions you have regarding the documents before you sign.

STEP 3:  We will witness your signature (assuming you wish to sign of course!) and complete the lender’s adviser certificate, to prove we provided the advice in accordance with their requirement. If you prefer, we can send your signed paperwork back to your lender, or other solicitors acting on the transaction for you.

Can I be accompanied by a friend of family member during our ILA appointment?

Generally, so that you can speak candidly, you should be on your own for the meeting, and not accompanied by friends or family members. If you have a particular need to have someone else present, please do let us know when booking your appointment.

How much does Independent Legal Advice cost?

The team at Scott Bailey are highly experienced in providing fast and efficient ILA to clients on a wide range of matters. Scott Bailey are also one of the few law firms in the New Forest, and greater Southampton area providing independent legal advice.

Our 2023 prices are as follows:

Basic independent legal advice fee – £440 + VAT for one person on a bank or other lender security document. For each additional individual requiring ILA on the same matter, we charge just £160 + VAT.  

Occupier’s Consent – for equity release and third party charge matters, a basic occupier consent fee is £350 + VAT. For each additional occupier required to obtain advice on the same matter, we charge £150 + VAT.

How do I get Independent Legal Advice?

If you would like to find out more about what is involved with obtaining ILA, or you are ready to book an appointment, please contact our expert independent legal advisers in Hampshire. Based in the Lymington in the New Forest, we provide ILA to clients across the Dorset, Wiltshire and Hampshire region.

Increasingly, lenders are happy for ILA to be provided remotely, and where this is the case we can provide the advice remotely wherever you are based.  Ask your lender, or get in touch if you are unsure.

Ben Ironmonger is Partner and head of Company and Commercial law at Scott Bailey LLP and regularly provides ILA services. As well as Ben, ILA is provided at Scott Bailey by Victoria Smalley (licensed conveyancer) and Daniel Ratcliff (legal executive).