Exchange depost query

jde91

Hello everyone. I'm sure this is a basic question, but I've spent the morning searching for answers, and can't seem to find a clear answer! Almost all the advice I find is for FTB, which we are not.

I'm trying to work out how much money we need to save in order to move house in the future, but I'm confused by the exchange deposit. As far as I can understand, our buyers exchange deposit goes towards paying our exchange deposit. 

Presuming everyone pays 10%;

• Our buyers would pay £15,000 (presuming our home sells for £150,000)
• We can use that money towards our exchange deposit of £30,000 (on a house worth £300,000)

But where does the additional £15,000 come from to make up the rest of our exchange deposit? Can we use the equity in our current home? Or would we need to exchange and complete on the same day in order to do this?

Thanks for the help!

AdrianC

It doesn't... The £15k exchange deposit from the bottom of the chain just goes up the chain, and those selling more expensive houses just accept a smaller %age.

Gentoo365

Is that just accepted as normal? Or negotiated?

greatcrested

Negotiated. And your seller might or might not agree. After all, they need as much as possible from you toput towrds their own 10% deposit....

If they refuse, you either

* Exchange/ Complete simultaneously (increasingly common since COVID)

* use £15K from your savings

* borrow £15K from family, crdit card or bank loan

But no, the equity in your current home willnot be released till Completion

Rodders53

AdrianC said:

It doesn't... The £15k exchange deposit from the bottom of the chain just goes up the chain, and those selling more expensive houses just accept a smaller %age.

Usually, but not always? 
If a smaller %age, or fixed sum, is not agreeable, then someone in the chain has to find some more deposit money to pass on up...

Last sale/purchase our buyers messed up their deposit monies, and even that was paid to their solicitors at the very last moment...  It was easier to pay our Sols the "missing" £1k the day this was found, to pass up the chain, than delay the exchange.

But this is something the OP's solicitor should/will discuss with them?