Scotland. Cash buyer/no chain - when is the 10% deposit paid for property? Exchange or completion?

benjymaria

Hi, I'm hoping that someone with knowledge of mortgages and buying property in Scotland can help. This is my first time (hopefully) buying in Scotland.

I (will) have a 10% deposit on the value of the property and as I've been renting there is no chain.

Basically, what I need to know is: when do I need to pay the 10% deposit? I had assumed it would be the day of completion (the same day the bank transfers funds/mortgage), but online I've read it's on the day of exchange of contracts.

I've looked at various pieces of advice online and find it all a bit conflicting and I'm getting muddled with what happens in Scotland with what happens in the rest of the UK.

The extra month or so in between exchange and complete makes all the difference to me in terms of having the last chunk of my deposit ready

Also, kind of related ... in addition to my 10% deposit (10% of the value of the house), I will owe another few thousand on top of my 90% mortgage (due to the 'offers over' system) ... I'm presuming that I pay that on the day of completion and not in advance? Again, this makes all the difference

Many thanks in advance.

Edi81

You are not a cash buyer if you are taking a mortgage.

Exchange and completion are England and Wales terms

benjymaria

Edi81 wrote: »

You are not a cash buyer if you are taking a mortgage.

Exchange and completion are England and Wales terms

OK, thanks. I'll edit my post.

dunroving

benjymaria wrote: »

Hi, I'm hoping that someone with knowledge of mortgages and buying property in Scotland can help. This is my first time (hopefully) buying in Scotland.

I (will) have a 10% deposit on the value of the property and as I've been renting there is no chain.

Basically, what I need to know is: when do I need to pay the 10% deposit? I had assumed it would be the day of completion (the same day the bank transfers funds/mortgage), but online I've read it's on the day of exchange of contracts.

I've looked at various pieces of advice online and find it all a bit conflicting and I'm getting muddled with what happens in Scotland with what happens in the rest of the UK.

The extra month or so in between exchange and complete makes all the difference to me in terms of having the last chunk of my deposit ready

Also, kind of related ... in addition to my 10% deposit (10% of the value of the house), I will owe another few thousand on top of my 90% mortgage (due to the 'offers over' system) ... I'm presuming that I pay that on the day of completion and not in advance? Again, this makes all the difference

Many thanks in advance.

FYI, in Scotland the main landmarks are conclusion of missives and the entry date. The former is loosely equivalent to the exchange of contracts stage in EW and the latter is loosely equivalent to the completion stage in EW.

The use of "exchange" of missives term in Scotland can lead to a bit of ambiguity in that is definitely not similar to "exchange" of contracts in EW.

davidmcn

Everything is paid at completion / settlement / date of entry. With rare exceptions, we don't have contractual deposits paid at "exchange" / conclusion of missives.

benjymaria

Many thanks, Dunroving, for the explanation.

davidmcn wrote: »

Everything is paid at completion / settlement / date of entry. With rare exceptions, we don't have contractual deposits paid at "exchange" / conclusion of missives.

Thanks you, davidmcn - that's what I was hoping for!

Jinx

When I bought recently our deposit had to be with our solicitor at the latest the day before the house settled so it could be paid out to the seller on our moving day with the mortgage cash.

benjymaria

Jinx wrote: »

When I bought recently our deposit had to be with our solicitor at the latest the day before the house settled so it could be paid out to the seller on our moving day with the mortgage cash.

Thanks. Day before should be manageable. I just want to be sure my salary has gone into my account as the last chunk of deposit will be coming from it.

jennifernil

Your solicitor will require that he has cleared funds from you available the day before the entry date, not to comply with that would make him very unhappy!

Once missives have been concluded you are bound to the agreed entry date, so you do need to ensure that you have the funds in place.