How to pay solicitors, estate agent fees etc if no money until after sale?

ClaireB182

I would really appreciate some advice please. Its been 18 years since we have moved and so much seems to have changed!

In brief, our situation is that we have been paying interest only for some time since I became too unwell to work. We have 4 years left on the mortgage. We have decided to sell up (its the only way we can pay off the mortgage) and downsize and relocate. Luckily we have over £170k in equity in the house after the mortgage is paid off and where we intend to move to we can buy a house outright with money left over.

The trouble is, we dont have any savings at all. I cant see how we can pay the estate agent fees, solicitors fee etc as we wont have the money until after the sale. Last time we were able to get a bridging loan from the bank but our situation is different now in that we are not taking another mortgage. We will not be able to get a loan due to debts we incurred when I became unable to work.

Feeling stuck and confused so if anyone can help me straighten my head out about how we can do this please, I would be very grateful

pinkteapot

Solicitor fees and estate agent fees are paid on completion - your solicitor will deduct them from the sale proceeds, so you don't need the money on hand.

You'll need to pay your solicitor a deposit - around £250 in my experience.

Estate agents shouldn't charge any up-front fees. Avoid Purple Bricks and similar online ones where you do pay upfront, and double-check that agents don't have any upfront fees before having them out to value.

If you're buying another house at the same time, you'll need to pay a 10% deposit on exchange of contracts, but your buyer will pay you a deposit so you can just pass that along. If you're downsizing then 10% of your sale price will be more than 10% of your purchase price.

If you're buying you will need money for the mortgage application (if applicable) and survey fee upfront. Surveys vary in price depending on what level of survey you have.

davidmcn

It's normal for most of the bills to be settled at completion, so I wouldn't worry unduly. You are however likely to need to some money upfront for things like surveys (assuming you're buying simultaneously with your sale), and possibly solicitors will want some funds for searches etc, so you're going to have to get funds from somewhere.

PasturesNew

The sale money goes to the solicitor.
They have done the sums to make sure there's "enough" there for all bills to be paid, else somebody who is owed money is at the back of the list and won't get lucky.

The solicitor gets the money in front of them, he lifts out his bill/money, he pays any estate agents and mortgage companies and other charges.

Only then do you get your hands on the money, you get what's left. All of the above happens in 10 minutes flat, instant.... so solicitor gets the money, removes the total sum of all the claims and bills on the sale, forwards you the rest.... or forwards it along a chain if you're buying something at the same time.

ClaireB182

Thank you all very much I had myself in a panic thinking we were going to have to find thousands of pounds up front! Thank you for helping and for your patience.

burtbot1

You'll probably need a few hundred for searches, but also if you want a survey you'll need money for that too. I think most of the other stuff you only pay on completion .

maisie_cat

We are doing the same thing, the only things we've had to pay up front is £950 to the solicitors

Johnhowell

Near to completion you should receive the final invoice from the solicitor listing all the costs associated with the sale.

I would check careful the list against the original quotation you receive at the start of the process. However, I notice some items are described differently and the relevant VAT applied differently so it can be difficult to cross check - there was a discrepancy.

Also, with the correctly figure included the final total figure was out by +£104! A quick e-mail to them, they e-mail a corrected invoice.

I wonder how many people check the numbers during the pressure time of moving and blindly accept the amount and the solicitor deducts!

Good luck.

davidmcn

Johnhowell wrote: »

I wonder how many people check the numbers during the pressure time of moving and blindly accept the amount and the solicitor deducts!

Any discrepancies would be picked up eventually - solicitors are heavily audited and can't just pocket any "change" left on their client account.