How are 'deposits' /down payments paid/transferred from customers to the lender??

Jane_gs

If you want a mortgage, and are giving your 10-20% deposit/downpayment to the bank then how are these usually transferred from your bank account to the mortgagte lender?

what are the all the common options, to trasnfer these funds from the bank account to the lender?

MX5huggy

The money does not go to the lender, it goes to the seller along with the mortgage money via solicitors.

Debt_Free_Chick

Agree. You pay your deposit to your solicitor. You may not be able to make a direct transfer through online banking (many banks have limits), but you should be able to telephone or go in to the branch and arrange a CHAPS/TT payment. Remember to take ID!

Jane_gs

Debt_Free_Chick wrote: »

Agree. You pay your deposit to your solicitor. You may not be able to make a direct transfer through online banking (many banks have limits), but you should be able to telephone or go in to the branch and arrange a CHAPS/TT payment. Remember to take ID!

The deposit is for the lender, not for the solicitor right?

Does the solicitor then 'pass' the deposit on to the lender?

arbrighton

No, it goes to the vendor, via the solicitors.

Debt_Free_Chick

Jane_gs wrote: »

The deposit is for the lender, not for the solicitor right?

Does the solicitor then 'pass' the deposit on to the lender?

You send the deposit to your solicitor. They hold on to it. Your solicitor then contacts your mortgage company and arranges for the mortgage (the purchase price less your deposit) to be paid to them (your solicitor) no later than completion day. On completion day, your solicitor sends the total (your deposit plus the mortgage amount) to the seller's solicitor.

No later than completion day you will have to send other payments to your solicitor e.g. Stamp Duty Land Tax (if applicable) and possibly an amount to cover your solicitor's fees. During the sale process, your solicitor will need other payments e.g. to cover searches.

HTH

Richard_Webster

If you want a mortgage, and are giving your 10-20% deposit/downpayment to the bank then how are these usually transferred from your bank account to the mortgagte lender?

Think about it - what does the lender want your deposit for? What is it going to do with it? Don't you think the seller will want it - as has been explained by others.

G_M

QUOTE=Jane_gs;53665399]The deposit is for the lender, not for the solicitor right? Wrong.

Does the solicitor then 'pass' the deposit on to the lender?No.

The seller (vendor) is selling his house. So the sale price you have agreed goes to him in return for that house.

The sale price is usually made up of:

a) the buyer's mortgage plus
b) some cash the buyer has in his pocket, or under his matress, or in his bank account (the deposit)

So a) and b) go to the buyer's solicitor, who gives it to the seller's solicitor, who gives it to the seller (in return for the house.)

The mortgage lender therefore sends a) to the buyer's solicitor.
The buyer sends b) to the his solicitor.

As to your question:

what are the all the common options, to trasnfer these funds from the bank account to [the solicitor]

a) If you do it early enough - cheque (5 working days)
b) cash - not advised an many solicitors will refuse!
c) CHAPS / TT transfer - same day. Costs £25 - £35
d) BACS (online/telephone banking) transfer - 3 working days
e) Faster Payments transfer - same day. Not all bank accounts support this. There may be a limit on how much, so may need to do several FP transfers over several consecutive days

Does that help?