Deposit required on new build

gcb

Hi,

We paid £2000 to a builder to secure a reservation on a new build home and have now accepted an offer for our current house, with a sell date of 2 months from now.

The builder already has the house partially built and is happy to progress to meet our schedule but wants to get contracts signed as quickly as possible. The builder had previously said that he would be looking for a 5% deposit paid when the contract is signed.

We are in the process of setting up our mortgage for the new property and this should be completed in a few weeks. On sale of our house we will have equity that will be used towards the purchase of the new build. My question is....is it typical that the mortgage lender will release the 5% up front fee that the builder is expecting on signing of the contract (i.e. once the mortgage approval is complete but before the final hand-over)?

Thanks in advance for any advice.

Thrugelmir

The deposit for the property you are buying, is normally funded from the deposit your buyers pay on yours. The mortgage lender will not advance funds.

ethank

Your deposit will pass up the chain from your buyers. You need to exchange contracts on your sale before this can be passed on.