Solicitor asking for full balance

bigtel_2

G_M wrote: »

Your post is not clear. What stage of the process have you reached?

If you have just instructed them, it is usua to pay a small advance (several hundred £?) to cover search fees etc.

If you are approaching Exchange, you will need to pay the (usually) 10% deposit on Exchange (your mortgage will not be received by the solicitors till later ie a day or so before Completion).

If you are nearing Completion, you will need to pay any outstanding amount towards the total costs, less whatever the mortgage lender is contributing and whatever you've already paid.

Apologies, I would say we are approaching exchange. In the documentation they had asked the seller to give a date and all the searches etc have been completed.

From what you are saying it's as if they want the 'nearing completion stage' money now.

Snakey

I paid some disbursements and a part fee in advance to the solicitor for them to start work, then I paid over my 10% deposit a few days before exchange, then I got a "completion statement" shortly afterwards (I had only a week between exchange and completion) which showed all the rest that I owed (remaining funds and remaining legals, less the money that was coming in from the building society for my mortgage). The mortgage broker got paid shortly after completion.

The solicitor needs to have cleared funds equal to the deposit that he has to hand over to the other side's solicitor before he can exchange contracts, otherwise he'd be paying for it himself in the hope that you'd pay him back and who's going to do that!

Often the exact date of exchange isn't known in advance - I paid mine over when we considered it was imminent - I think he might have technically had the use of my money for a few days but I didn't see that as a problem, it's not as if I was getting a huge interest rate in my instant-access savings account.

brenda10

bigtel wrote: »

Apologies, I would say we are approaching exchange. In the documentation they had asked the seller to give a date and all the searches etc have been completed.

From what you are saying it's as if they want the 'nearing completion stage' money now.

We paid £200 (March)as requested so that the solicitor could start the process and knew we were committed to them for a house purchase.
As we were in a chain we instructed them not to do any searches until we were sure the property was ours.(searches started mid May)
When sellers accepted our offer(and knew their chain complete) and we knew they were committed to selling to us (beginning May) we then instructed the solicitor to do the checks/searches.
We exchanged contracts paid 10% deposit of house price plus all outstanding sol fees inclusive of stamp duty for our 190K house(£2664 all in)
We complete today so all final moneys owing were received from us by solicitor yesterday.
Good Luck
Once you hand over ALL your money they have you over a barrel...especially if you are unhappy with their performance, otherwise if just paid £200 you can walk away as less of a loss. Our house purchase took from 13th March until today, our 25% deposit money has been saved in a higher interest account of ours not the solicitors!!

silvercar

We only transferred the completion money a couple of days before completion.

A lot of our money was tied up in ISAs and TESSAs, we wouldn't have been prepared to close those down and withdraw the money until we had exchanged as once closed they lost their tax free status.

G_M

Thrugelmir wrote: »

I've never dealt with a solicitor that would proceed without the certainty of funding being in place.

If there is, say, a month between Exchange and Completion, then the solicitor will not need the final payments till a few days (or a week to be safe) before Completion.

Yes, before Exchange the solicitor will want to be satisfied that the funds are in place - in the sense of available - but should not require them to be in his client account.

Indeed it may well be that the month between Exchange/Completion is specifically to obtain the funds, which may for example be in a 30 day notice bank account.

m_13

The OP is a FTB who is being asked to pay the full deposit to exchange though? Have I got that wrong?

eddddy

bigtel wrote: »

Apologies, I would say we are approaching exchange. In the documentation they had asked the seller to give a date and all the searches etc have been completed.

From what you are saying it's as if they want the 'nearing completion stage' money now.

Hi bigtel

I think your solicitor is just taking a more cautious approach - maybe because you're FTBs and/or because you may not have dealt with that firm before.

If the sol has all the money (apart from the mortgage funds) before exchange, he/she can be 99.99% sure that completion will happen smoothly.

If this is a problem for you (money in ISAs etc), you could explain to the sol - and they may exchange anyway, but with dire warnings about what would happen if the money didn't turn up in time for completion.

G_M

m_13 wrote: »

The OP is a FTB who is being asked to pay the full deposit to exchange though? Have I got that wrong?

This may be the case.

And it may be confusion over the term 'deposit', which has two meanings:

1) the 10% payable to the seller on Exchange.

2) the amount the buyer is putting into the purchase ie the purchase price less the mortgage amount. This may be 5%, 10%, 20% or indeed 50%

1) above has to be paid before Exchange.

2) above has to be paid before Completion.

Jenniefour

Is this a cash buy? Or mostly cash? In which case solicitor does need the deposit. I did it when I last moved. Tiny mortgage compared to agreed price. Was asked to transfer money for deposit prior to exchange.

TighterThanTwoCoatsOfPain

There is hardly and chance anyone in this thread as a FTB/ bottom of chain didn't pay the deposit just prior to exchange... It just doesn't happen. You wouldn't be exchanging contracts with me (or just about any solicitor going) without putting your money down.

If you're in the middle of the chain then it's the FTB deposit that usually gets passed up the chain which is why people perhaps think they didn't pay one. The reality is you received and passed on your buyers deposit until it gets to the top.