What happens if your conveyancer goes bust mid-transaction

Conveyancing firms occasionally go under, or get shut down by their regulator. The PM Law collapse in 2023 caught thousands of in-progress transactions and is the best-known recent example, but it isn't unique. Knowing what happens when a firm fails — and where the protection runs out — is useful before you sign up with anyone.

What the regulator does

If the SRA thinks a solicitor firm is putting client money or files at risk, it can step in. That's called an intervention. It shuts the firm down, takes control of client files, and protects any client money in the firm's accounts. The paperwork side of it takes days to weeks, and your matter is on pause for the duration.

The CLC has the same kind of powers for licensed conveyancer firms.

Client money protection

Regulated conveyancers have to keep client money in a separate client account, ring-fenced from the firm's own funds. So even if the firm goes bust, the money that's yours is still identifiable as yours.

On top of that, the SRA and CLC both run compensation funds for cases where client money gets lost through dishonesty or failure. There are limits and conditions on both — recovery isn't automatic and isn't always full.

What you actually do

If your firm is intervened or goes under partway through your purchase or sale:

• Your file gets transferred — either to the SRA's intervention agent or to another firm appointed to pick the matters up.
• You instruct a new conveyancer. They take over from wherever the old firm got to. There's a delay while the file is dug out and handed over.
• If you've already exchanged with a completion date pencilled in, get on the phone to the other side straight away and explain what's happened. You may need to renegotiate the date.
• Keep copies of everything your conveyancer ever sent you — searches, contracts, the title pack — so the new firm doesn't have to redo anything.

How to lower your risk going in

There's no public data on conveyancers' financial health detailed enough to actually predict failure. We don't publish anything like that on Cleerd. We decided early on to stay out of the “is this firm about to go under” game in v1 because the data isn't reliable enough and getting it wrong would do real damage.

What you can do: use a regulated firm (SRA or CLC), check the register directly before you instruct, keep copies of every document they send you, and pay attention if anything about the firm's communication starts feeling off. The SRA is on 0300 672 0900 and the CLC on 0203 859 0904 if you want to flag a concern.