Deposit on exchange flowing up the chain

Thrugelmir

Comms69 wrote: »

That's not how failure to complete works. You each sue the person in the contract working backwards.

A may end up sueing B.

If A is in a position to complete.

jackomdj

But B has had his money.
In your example
if A is buying from B and house is £100,000. A gives their solicitor £10,000. A's solicitor passes B's solicitor the £10,000
If B is buying from C and house is £150,000 B gives their solicitor £5,000. B's solicitor passes C's solicitor £15,000 (The £10,000 from A's solicitor and £5,000 from .

Is it fails to proceed C has £15,000 in their pocket. B is £10,000 better off (as they only physically handed over £5,000 of the £15,000 they paid to C)

If they only pass the initial £10,000 up the chain at exchange, then B still owes C £5,000.

This is a simplified example as other things may come into play.

jackomdj

Tom99 wrote: »

I have always thought that the practice unusual. If I was A buying from B and have paid 10% deposit then I would want B's solicitor to look after my deposit until completion.
After all that money is mine until such time as completion or failure on my part to complete happens.

In my example above, this is fine, but you would have to hand your solicitor £15,000 to pass up the chain. Often people don't have the physical cash until completion as it is tied up in the equity of their house.

Just read again and saw you are A. Still applies, B would then have to 'find' £15,000 in cash which he may not have until completion.