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New Build - Reservation Fee
LauraWxx
Posts: 565 Forumite
Hi,
I am in the process of buying a New Build apartment and wondered what is the normal process of what happens to the reservation fee.
At time of reservation I put down £500, we are now about to exchange.
I have asked the sales team on site who have given me conflicting responses and have then advised me to speak to solicitor.
I have tried to call him but unavailable at the moment. Obviously he will be able to tell me the definite answer...but i was just wondering what NORMALLY happens to this money?
I was under the impression it was given back to me on completion, but the other view from the staff on site is that it comes off the final account??
Anyone got any experience of this?
I am in the process of buying a New Build apartment and wondered what is the normal process of what happens to the reservation fee.
At time of reservation I put down £500, we are now about to exchange.
I have asked the sales team on site who have given me conflicting responses and have then advised me to speak to solicitor.
I have tried to call him but unavailable at the moment. Obviously he will be able to tell me the definite answer...but i was just wondering what NORMALLY happens to this money?
I was under the impression it was given back to me on completion, but the other view from the staff on site is that it comes off the final account??
Anyone got any experience of this?
2019 Totals: Savings: £929.53 / Mortgage OP - £746.32
Grocery challange April: £130.17of £500 target remaining
Grocery challange April: £130.17of £500 target remaining
0
Comments
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it comes off final account, in every case I've ever dealt with, so will form part of your deposit for the house.0
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would I be right in thinking that solicitors fees and any extras that I have had would also be charged to this final account??
Because the deposit and mortgage make up the full purchase price of the property, if it was only for the property then my final account would surely be £500 in credit?2019 Totals: Savings: £929.53 / Mortgage OP - £746.32
Grocery challange April: £130.17of £500 target remaining0 -
imagine it like this
Purchase price - £100,000
less:
reservation fee - £500
exchange monies - £19,500 (they have laready had £500 so thats a 20% deposit)
mortage funds - £80,000
Add : land reg fees - £200
Add : legal fees - £700
Amount required to complete - £900. which is payable to the solicitor.
The res fee is paid to the developer, and as such it forms part of the deposit, so your deposit should include this amount.0 -
Ok thank you for that.
So I paid my deposit but it was the full amount, not less the £500 I have already paid.
Hopefully my solicitor will not have sent more than what is required!2019 Totals: Savings: £929.53 / Mortgage OP - £746.32
Grocery challange April: £130.17of £500 target remaining0 -
since he has forwarded the full deposit and reservation fee, he will simply hold back £500 from the mortgage cash when he recieves it, and ask you to pay £500 less for the fees and searches.
Just be sure he knows about the res fee and has noted it down, and check all the paper work pre completion (get a draft completion statement the week before you complete)
Good luck and have fun in your new home!0 -
Thank you!!2019 Totals: Savings: £929.53 / Mortgage OP - £746.32
Grocery challange April: £130.17of £500 target remaining0
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