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Buyer only has 5% deposit!
Lu_Lu
Posts: 228 Forumite
We are 2 days away from exchanging and I've just found out our buyer only has a 5% deposit, despite previously assuring us they had 10%. This would be fine normally but I need their 10% deposit to give our 5% to the builder on exchange and now I am £10K short!
Not sure how to break this to the solicitor now and how the heck can I come up with £10K in 2 days time!!!
Not sure how to break this to the solicitor now and how the heck can I come up with £10K in 2 days time!!!
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We are 2 days away from exchanging and I've just found out our buyer only has a 5% deposit, despite previously assuring us they had 10%. This would be fine normally but I need their 10% deposit to give our 5% to the builder on exchange and now I am £10K short!
Not sure how to break this to the solicitor now and how the heck can I come up with £10K in 2 days time!!!
Does the deposit go to you? Surely it goes to their lender? and you get the full price on completion?0 -
I'm not sure how it works. Doesn't their deposit go to the solicitor who then will pass it to our vendor?0
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Doesn't all the money from your sale go through there solicitor so whether they have 10% deposit or 5% deposit it won't matter as long as the mortgage makes up the remainder?:T:T :beer: :beer::beer::beer: to the lil one
:beer::beer::beer:0 -
I'm not sure how it works. Doesn't their deposit go to the solicitor who then will pass it to our vendor?
Yes. The deposit passes up the chain.
How much is paid on exchange is negotiable. When we moved last year, our buyer and then us both paid 10%.
- We sold for £250k. Buyer's solicitor transferred £25k to our solicitor.
- We had to pay a £47k deposit, so we gave our solicitor £22k to add to the £25k that came up from below.
However, a lot of the time people selling don't have £22k lying around in savings to add to the pot. If we didn't have savings and all our money was tied up in house equity, our solicitor would have negotiated for our seller to accept a deposit of £25k on exchange (slightly more than 5%).
First step: Speak to your solicitor. Get them to find out if your builder is happy to accept a smaller deposit. Just means they get less on exchange and more on completion. They may or may not agree.
Don't worry about breaking it to your solicitor!! You're paying them to work for you. You tell them the situation - they work on a solution.
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Talk to your vendor/builder - they may accept the amount you have.0
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Read 'a word about chains' here: http://fidler.co.uk/blogs/legalmove/category/conveyancing-deposit/0
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pinkteapot wrote: »Yes. The deposit passes up the chain.
How much is paid on exchange is negotiable. When we moved last year, our buyer and then us both paid 10%.
- We sold for £250k. Buyer's solicitor transferred £25k to our solicitor.
- We had to pay a £47k deposit, so we gave our solicitor £22k to add to the £25k that came up from below.
However, a lot of the time people selling don't have £22k lying around in savings to add to the pot. If we didn't have savings and all our money was tied up in house equity, our solicitor would have negotiated for our seller to accept a deposit of £25k on exchange (slightly more than 5%).
First step: Speak to your solicitor. Get them to find out if your builder is happy to accept a smaller deposit. Just means they get less on exchange and more on completion. They may or may not agree.
Don't worry about breaking it to your solicitor!! You're paying them to work for you. You tell them the situation - they work on a solution.
It all makes sense now, Always wondered why the first house we tried to buy went with a lower offer, the reason given was we were getting a 100% mortgage,0 -
Their problem. The contract says 10% deposit on exchange. They need to find 10% deposit on exchange. Some of that might be an early draw-down from the mortgage, of course.We are 2 days away from exchanging and I've just found out our buyer only has a 5% deposit, despite previously assuring us they had 10%. This would be fine normally but I need their 10% deposit to give our 5% to the builder on exchange and now I am £10K short!
Not sure how to break this to the solicitor now and how the heck can I come up with £10K in 2 days time!!!0 -
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Oh, absolutely. They don't come up with 10% deposit, no exchange.p00hsticks wrote: »...except, of course, that until the exchange happens there is no legallly binding contract in place.0
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