deposit on exchange

mylilangel

I am a FTB and about to exchange. Mortgage is 25% LTV. Reading through various posts, it seems that only 10% deposit is payable at exchange, but my solicitor has requested the whole 25% which is approximately 50k to be paid to their firm + fees and disbursements. Can I just pay fees and disbursements and 10% deposit, and hold off the rest 15% until completion.

Do I get any receipt or any document from the solicitors who would be holding my money, sorry if I sound daft. They have asked to me transfer 52k into their bank account or send a draft. What is the safest option. Is the money safe while the solicitors hold it! He has given an option of CHAPS transfer as well, how is that better from other methods of payement.

Thank you.

hazybubbles

is completion likely to be very soon after exchange? if so then the solicitors would need the funds at least the day before completion to make sure everything could be transferred on time.

G_M

At exchange the solicitor needs the 10% + his costs/disbursements. He prob wants the rest of the deposit either because Completion is following quickly, or he just wants to be sure you have it - failure to produce the balance at Completion would be serious.

Solicitors hold your money in 'client accounts' - separate from their own accounts, and these are ring-fenced so even if he goes out of business the money is safe. You should get a receipt.

CHAPS is fast (an hour or so) and costs £20-30 depending on bank.
Cheques/drafts etc are free but take days to clear.
BACS transfers are free but usually have a limit - up to £10K depending on the bank.

mylilangel

Thank you all for the useful replies.