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New Build part-ex deposit on exchange query
ColPops
Posts: 2 Newbie
We are looking into a part exchange on a new build house, where the developer will sell our property on our behalf in exchange for the new build house. The new house will not be finished until March 2013 at the earliest, but they would like to exchange contracts within 28 days, and completion would be floating.
On exchange of contracts they would like us to pay 10% deposit on the difference between the purchase price of new build 500k and the sale of our house 300k, being 20k. They are saying this deposit goes towards helping to complete the build of the house.
However most of our deposit funds for the new house are tied up in the equity in the house or in sources that will not be available to us until Jan 2013.
Where do we legally stand if we wanted to reduce the % requested on exchange or waive it completely?
Also what happens to our deposit money on exchange, if the house is not finished to the right standard, or delayed another 6 months etc., they still have our 20k and we are holding all the risk?
On exchange of contracts they would like us to pay 10% deposit on the difference between the purchase price of new build 500k and the sale of our house 300k, being 20k. They are saying this deposit goes towards helping to complete the build of the house.
However most of our deposit funds for the new house are tied up in the equity in the house or in sources that will not be available to us until Jan 2013.
Where do we legally stand if we wanted to reduce the % requested on exchange or waive it completely?
Also what happens to our deposit money on exchange, if the house is not finished to the right standard, or delayed another 6 months etc., they still have our 20k and we are holding all the risk?
0
Comments
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Strange - I'm doing part X for a new home and the builder said there is no need to pay deposit as the deposit cancels each other. There is an 80k price difference for me but I've never heard paying deposit when doing PX. Can we know what builder is it? I think it must be the builder's policy.0
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yes builder is Linden Homes, maybe because the price difference is 200k they are asking a deposit?0
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Is the builder buying your home from you or helping you sell it?
I have a deal that involved the builder selling my house for me (so helping rather than part ex) and I will have to pay a deposit on exchange. Part ex with my builder does not involve a deposit on the other hand.0 -
Where do we legally stand if we wanted to reduce the % requested on exchange or waive it completely?
Normally 10% of purchase price is payable on exchange of contracts. So would be £50k.
Expect no deal if try and change the terms.
The £20k is to make sure that you are serious purchasers.0
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