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Exchange of contract - deposits
Pigeonisland
Posts: 2 Newbie
Hi,
I have accepted an offer of 130k on my property. I have also had an offer accepted of 400k for another property.
The largest percent of the deposit is coming from equity from the sale. I may be wrong, but deposits after exchange of contracts tend to be 10%.
10% of my property is 13.2k
10% of purchase property is 40k
Will I have to locate the balance (from somewhere) before completion of sale or will this be taken from my buyers deposit and in liaison with the agreed mortgage which I have in place (again the majority of deposit is from equity of sale)?
I have accepted an offer of 130k on my property. I have also had an offer accepted of 400k for another property.
The largest percent of the deposit is coming from equity from the sale. I may be wrong, but deposits after exchange of contracts tend to be 10%.
10% of my property is 13.2k
10% of purchase property is 40k
Will I have to locate the balance (from somewhere) before completion of sale or will this be taken from my buyers deposit and in liaison with the agreed mortgage which I have in place (again the majority of deposit is from equity of sale)?
0
Comments
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You will either have to find the difference between 13.2K and 40K (£26.8K) from your savings, or negotiate a lower deposit on your purchase.0
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I think it's quite common with a chain for the deposit from the person at the bottom to be in effect passed up the chain. A lot of people have wealth tied up in their houses but lack ready cash to use as a deposit.
The deposit paid on exchange is different from the deposit required by mortgage providers. A lot of the mortgage 'deposit' comes from equity in the house being sold.0 -
True but the difference in deposit here is significant.I think it's quite common with a chain for the deposit from the person at the bottom to be in effect passed up the chain. A lot of people have wealth tied up in their houses but lack ready cash to use as a deposit.
The deposit paid on exchange is different from the deposit required by mortgage providers. A lot of the mortgage 'deposit' comes from equity in the house being sold.
If I were selling the £400K house, I would not accept a £13.2K deposit in place of £40K. At a push I might accept 5% (£20K).0 -
There are instances where your vendor (the £400K house) may accept a reduced deposit, usually if their exposure to risk is minimal. For example, they are not buying anywhere themselves.
If there is a large chain above them (for example) or they need a quick sale for whatever reasons, then they are unlikely to reduce their risk to do you a favour.0
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