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First Time Buyer Deposit Query

martyn_h_3
martyn_h_3 Posts: 1 Newbie
in House buying, renting & selling
Hi,

I'm a first time buyer currently going through the buying process. I have a query with regards to the deposit and when to pay it. As far as I understand, I pay a deposit (10%) at the exchange of contracts and then the remaining at completion. Is this correct?

So in my situation, I'm putting a 20% down which equates to £17200. So, at exchange do I pay £8600 which would be 10% of the purchase price and then at completion the remaining 10% which would be another £8600 plus the mortgage and fees ect?

Also, I have a help to buy ISA. Do I use the amount saved plus the bonus for the deposit at exchange or at completion or does it not matter?

Apologies if these are stupid questions or if they've been asked a million times before.

Thanks in advance!

Comments

  • glosoli
    glosoli Posts: 739 Forumite
    First Post Combo Breaker First Anniversary
    As I understand it the Help to Buy ISA bonus cannot be used for exchange, only at completion. Yes you would put down 10% at exchange, and the remainder at completion.
  • G_M
    G_M Posts: 51,977 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    martyn_h wrote: »
    Hi,

    I'm a first time buyer currently going through the buying process. I have a query with regards to the deposit and when to pay it. As far as I understand, I pay a deposit (10%) at the exchange of contracts and then the remaining at completion. Is this correct?
    Yes

    So in my situation, I'm putting a 20% down
    No. I suspect you mean you are paying 20% of the purchase price from your own funds. I doubt you are putting down a 20% deposit at Exchange.

    which equates to £17200. So, at exchange do I pay £8600 which would be 10% of the purchase price
    See the answer above. You pay 10% of the purchase price at Exchange, as you correctly said.

    and then at completion the remaining 10% which would be another £8600 plus the mortgage and fees ect?
    Yes. At Completion you pay the outstanding 90%, + SDLT, + any outstanding legal or other fees, being made up from a combination of your mortgage and your own funds

    Also, I have a help to buy ISA. Do I use the amount saved plus the bonus for the deposit at exchange or at completion or does it not matter?
    Ah! this contributes towards the balance required at Completion, thus reducing the amount you need to find from your other funds.
    ......................................................................
  • saajan_12
    saajan_12 Posts: 3,621 Forumite
    First Anniversary Name Dropper First Post Combo Breaker
    Exchange: pay 10% deposit from your own funds
    Completion: pay 90% of purchase price + SDLT + mortgage fee + solicitors fees.
    This comes from: mortgage + Help to Buy top up + own funds to make up the rest.
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