Deposits

ambroze

I am close to 'completing' on the purchase of a house. I am a first time buyer.

I have to submit a deposit of £21,000. I bank with Nationwide.

My question is, can I send a cheque to the solicitor or do I have to go into a branch to transfer the money in person? Secondly, I only have £20, 700 in my account, so I will be dipping into my £650 overdraft. Will this be accepted or does the deposit I send have to be totally 'in the black'?

RedFraggle

It would be usual to pay the money to your solicitor. They then make the transfer on your behalf. Provided you have the "available funds" for the payment to clear then there shouldn't be an issue with the payment. I assume you have funds coming from elsewhere to pay the solicitor etc. The solicitor won't do anything until the funds are cleared so I would suggest if timing is critical you make a transfer rather than send them a cheque but if you're not in a rush a cheque is usually fine.

ambroze

Timing isnt a problem. I know I have to pay the money to the solicitor, my question was, which method is best, cheque or electronic transfer etc. All the funds for my deposit are already in one place - my nationwide current account. However I do not have the full £21k - I only have £20,700 in my account. My query was, do I need the full £21k or can I dip into my overdraft for the extra £300?

ambroze

I know this sounds daft - it's just I'm paranoid as I've 'pledged' that I have £21k of my OWN money to put down as a deposit - and as an overdraft is technically the Banks money - will this be acceptable?

Soot2006

I assume you passed all the credit checks, etc -- did the solicitor or mortgage advisor never ask where the full deposit was coming from?

OR is the house deposit e.g. 20,000 with £1000 being solicitor fees?

ambroze

We're close to completeing - the mortgage was approved 2 months ago, contracts signed...just need to send deposit....had a big bill come up and had to dip into it by £300...can I use £300 of my overdraft to send deposit over is the question...

soley13

A CHAPS same day transfer, do it before 2pm and the solicitors will have the money in their account on the same day. There is usually a small charge of £25.

I don't think anyone will care that you dipped into your overdraft! I would'nt worry about it!

Evilm

If you send a cheque the solicitor will normally insist that it needs to be with them 8 working days before completion as this is nominally enough time for them to wait and see if it clears and if its unlikely to bounce.

I would suggest either a bankers draft (which will cost you a fee but is instantly "cleared funds" due to how they are raised by the bank) or a CHAPS payment (which will also cost you a fee). I would ensure that the CHAPS is done at least one day before completion - whilst they should arrive by 2pm it does sometimes take longer. Also the earlier your solicitor transfers the money to the sellers solicitors the earlier you can get your keys to the house you are buying!

The issue about using your overdraft is between you and your bank (which unless your mortgage is also going to be with them is unlikely to even be noticed or an issue.)