When do we pay our deposit?!

Alleygator

Hi everyone,

My partner and I are first time buyers and have just put a reservation fee down on a new build house. However our circumstances are a little bit different as the house we are buying is under the Council Affordable Housing scheme so we own 100% of the property but we only pay for 60% and don’t pay rent on the other 40%. However if we decide to move on it future we have to sell to other first time buyers who meet the criteria that we had to meet and the council will take 40% of the sale price which we thought was an amazing opportunity for us to get on the ladder!

We’ve put our reservation fee down, we have a solicitor who has dealt with other buyers on the site and we’ve got a meeting with an independent mortgage advisor next week so all seems to be going swimmingly.

But I’m just not quite sure when we pay our deposit?! We’ve got a 5% deposit ready and waiting but the house won’t be completed until the end of this year so if we didn’t have to pay our deposit straight away we could save a heck of a lot more to have a larger deposit.

Do we pay the deposit when we exchange contracts or is it when we complete? I’d ask my solicitor but this only dawned on me last night and she doesn’t work weekends!

Thanks in advance

Flugelhorn

You pay deposit at exchange of contracts which is usually a couple of weeks before completion

saant22

Hello,

We reserved a New Build a couple of weeks ago, we are expected to exchange in 6 weeks when we will pay our deposit, house is due for completion in November.


hope this helps

GoingOn30

Just beware that lots of new build companies will try and pressure you to exchange early which ties up your money, but then don't hold their end of the bargain and then the completion date is pushed back and back. There is no need to reason other than it suits them to have a large gap between exchange and completion so don't be bullied into putting your money down, that's what the reservation fee is for.