Proof of deposit

csgohan4

Locornwall wrote: »

Thanks silvercar, are you a mortgage advisor/broker?

Surely it’s one thing to suggest you’ll have for example £10,000 pay next month, even though you e averaged £3500 for sometime. Although saying I’m expecting £3500 next month and I intend on using £1000 of that towards my purchase price is reasonable given the completion would be a week or two after that?

What if your car broke down or you needed money for a personal emergency ?? There's a reason why some solicitors/ Lenders prefer full deposit on exchange/ mortgage application. They only work on the now not the if


They won't take promotions into account and potentially higher pay in the future, because it hasn't happened at time of mortgage application as an example


When you apply to a lender with 10% deposit for e.g they want to see 10%, not based on promises you will get it, regardless of whether you can do it or not, however not every lender requires full deposit noted at application


Your not lending money off Johnny from the Pub, the banks are regulated and they cannot lend a particular product if the client does not meet their criteria

[Deleted User]

Locornwall wrote: »

Thanks silvercar, are you a mortgage advisor/broker?

Surely it’s one thing to suggest you’ll have for example £10,000 pay next month, even though you e averaged £3500 for sometime. Although saying I’m expecting £3500 next month and I intend on using £1000 of that towards my purchase price is reasonable given the completion would be a week or two after that?

I have done plenty cases where clients are saving for example £500 a month and they have done for years. Got track history to show it. Find the ideal house and are a few hundred short for the deposit. Im happy to do this as they have such a strong record of savings (and savings only going 1 way, not saving and then taking it back out through the month).
Mortgage companies can be flexible with this to some extent but it sounds like you want to exchange without the full deposit in place.
Thats more of a question for your legal rep but i havent seen it happen in my 13 years in the industry.

If you didnt have the funds come completion time and you forfeited the purchase and the deposit, whos fault is that? You for not having funds? or the conveyancer for not checking you had them before locking you in to a financial contract?

Unless your solicitor says otherwise, I am 99% sure you will need the full deposit available at exchange

Locornwall

Then regulate multi million pound properties in central London and football clubs, not someone who has a regular income in a permanent job looking to buy a home for his family. Funnelling a couple of thousand pounds of criminal money into a property doesn’t spring to mind when I think of money laundering. But that’s just me. If it’s about affordability, where to start.

[Deleted User]

It looks like you are wanting someone to give you the answer you want to hear rather than the one that exists in real life.

Plenty lenders dont ask for proof of deposit on application. The deposit checks are left to mortgage brokers (who can be flexible depending on how far away you are and plausibility of it being in place for exchange) and solicitors (who will need to evidence funds before having you lock yourself in to a financial contract).

None of this is unreasonable. If you dont have deposit in time for exchange your options are to 1) delay exchange by a few weeks with everyones agreement; or 2) wait a few months before you start the purchase process.

Locornwall

Thanks. Problem is people have different opinions here and I’m trying to get as much clarification as possible. In the end I’ll be speaking to a mortgage broker for ultimate confirmation of course.

Verix

It is not that unusual on new build cases to not need all the funds at exchange of contracts. I've had plenty of cases in the past where people have exchanged contracts on say 3% who will then give the remaining 2% at completion to make up the full 5% deposit. With new builds people can exchange on properties that won't be built for 6 months of more so having those funds available so early isn't necessary, as long as it's clear where they will be coming from.

As long as you, the builder, the lender and solicitor are happy with this arrangement it can certainly be done.

davidmcn

Verix wrote: »

It is not that unusual on new build cases to not need all the funds at exchange of contracts. I've had plenty of cases in the past where people have exchanged contracts on say 3% who will then give the remaining 2% at completion to make up the full 5% deposit. With new builds people can exchange on properties that won't be built for 6 months of more so having those funds available so early isn't necessary, as long as it's clear where they will be coming from.

As long as you, the builder, the lender and solicitor are happy with this arrangement it can certainly be done.

I'm also surprised that solicitors are requiring buyers to have the entire funds needed for completion at the point of exchange - which seems to be purely for their administrative convenience. As long as the client is aware of the actual deadline for getting their money together (and the consequences if they don't) then it can wait until later.

OP, if you want to know what your solicitor requires, you'll need to ask them. As you can tell, there aren't standard requirements.

olgadapolga

Maybe it depends on both the solicitors and the individual buyers?

When we purchased our last house, the solicitor required all the money by exchange, including her fees, stamp duty and the deposit plus everything else.

For our current purchase, we only had to provide the 10% deposit before exchange. The remainder will need to be paid by close of business the day before completion.