Long Stop Date and Equity

CalmCookie_2

Hi,
I am in the process of selling my house. The chain is quite long but everyone appears to be doing their thing..ie solicitors, surveys,mortgages etc.
I am fortunate in that I am buying a new house which is costing less than what I am selling my current home. However my new house is being used by the builder as the show home and their site office...no problems...I'll wait and rent and my solicitor has confirmed a long stop date with them of December 07.
My question is...the money I have from the sale of my current home will go where? and until when? and who will benefit from the interest that the money will get in whoevers account? and when do I receive my equity?
I would ask my solicitor but he's off sick at present and I feel an independent answer would be helpful as there is quite a substantial amount of money involved....to me anyways. If there's going to be 3 months worth of interest on the total amount of the sale of my house before completing on my new home then this would help pay for my rental in the time being.
Look forward to an answer.......

:cool2:

lynnexxxo

I am in a similar (ish) position. We are goin to have 50k equity for 3 months and I want interest on it! My solicitor says he can keep it in an account for me (very crap interest), others on here have suggested ICESAVE - online bank offering 6%+ interest with instant access. I have decided to go with my own bank (RBS) who have set up a savings tracker thing (interest rate 5%). The reason I decided to take the lower rate is the convience, RBS says I can easily move my money, interest is worked out daily and paid monthly and in the worst case I can walk into branch and demand my money (in pound coins if I wish!). Whereas the ICESAVE is based in iceland and although most reports on in are good I am a bit wary that a delay on there part could jepadise my house purchase.

I reckon I should get about £200 for every month the money is the account.

CalmCookie_2

Thanks for the quick reply......any idea what happens to the money from the sale of my house that will be used to buy my new house?....from what I understand...until Completion on my new house sometime in December possibly, the money which is going to pay for it will be sitting in someones account.....can I have the interest from that?....as it's my money?

:cool:

lynnexxxo

Your solictor should give you a cheque after your house is sold (minus his fees, EA fees etc). Its your money to do whatever you want with!

CalmCookie_2

Even though he's waiting to complete on my purchase? and he'll give me it all to me until my completion date when obviously he'll need the money then to give for my new house?

Is that right......I thought these canny solicitors might want to keep hold of it......

Doozergirl

They will give it back to you. You aren't actually in a chain so the solicitor will transfer the funds, minus any mortgage, to your account. If there is any money needed for the deposit on the new house, they will pass that on to the builder.

When you come to buy, they will let you know how much money you need to complete.

It's the story of my life. I get it, then I have to give it all back again.

franklee

If it were me I'd want it sitting in my account. If you are transferring large amounts of cash then it's worth paying the 30 quid for a CHAPS transfer if the loss of interest for 3-4 working days in transit for a BACS payment is more than that. Your solicitor should tell you when to transfer the money back to him in time for completion. Looking after a lot of money is a bit of a responsibility so if you do that check the account balance regularly.

If you would be tempted to blow the lot on loose living, then let the solicitor keep it. If the solicitor does keep it then mine says the money will be held in a separate client account that will pay interest in accordance with Law Society rules. Not that I know what they are.

Richard_Webster

You should definitely get your money back. I would only hold onto client's money between separate sale and purchase completion dates if the fairly low rate of interest I would give the client, was about the same as any higher rate the client could obtain, less the cost of electronic transfers each way.

Therefore for a shortish period it might be worth the client leaving the money with me - but 3 months I doubt it!

As a conveyancing solicitor I believe the information given in the post to be useful but I accept no liability except to fee-paying clients

PasturesNew

Open up a instant access savings account with high interest.

Sainsbury's e-saver is one of the highest - but see Martin's list here.

Then tell your solicitor to pay the money from your house sale directly into that account.

Then, when the money is needed to buy your new house you transfer the money from your high interest savings account to your solicitor's account.

You will get good interest in the meantime. Should be able to pocket nearly 5% on the money after tax.