New build and deposit

.sparrow

Hi all,


Me and my partner are buying a new build. We have very nearly saved our deposit, but we want to reserve our plot. It looks like the house won't be built for another 8/9 months, but it's a popular development.


Are we able to reserve now and save more to our deposit in the meantime?


I know there are loads of new build posts here - sorry if I've missed the answer when searching.


Thanks

AnotherJoe

what do you mean by "deposit" ? Do you mean a reservation fee or do you mean your 5 or 10% mortgage deposit? The builder will only want the former first.

kingstreet

You will usually be expected to exchange contracts within 28 days of making your reservation and that means having a formal mortgage offer and handing your deposit over to your solicitor.

If you plan to put down 10% on completion but can pay 5% on exchange and the builder agrees to that, you may be able to save the additional 5% between exchange and completion but this may be problematic for your lender.

.sparrow

Thanks and yes the deposit for the mortgage. 28 days seems like a real push - do people actually complete in this timescale in reality? What normally happens if they are still securing the mortgage or dealing with a slow solicitor?

kingstreet

No. That isn't completion, it's exchange of contracts. Completion is when the balance of the monies and keys change hands.

Yes, it's usual for people to reserve and have their mortgage offer and legals done in 28 days. We achieve that all the time as we're newbuild specialists.

You will usually need to have an agreement in principle with your chosen lender before you are allowed to reserve.