Transferring funds

ccfc1972

Sorry, one other question regarding the deposit on exchange.
How does this work? I assume we have to pay 10% of the purchase price. Does this come from the sale of our property or do we have to pay that up front? Nobody has even mentioned a deposit payable to us.

pinkteapot

ccfc1972 said:

Sorry, one other question regarding the deposit on exchange.
How does this work? I assume we have to pay 10% of the purchase price. Does this come from the sale of our property or do we have to pay that up front? Nobody has even mentioned a deposit payable to us.

Normally, yes, you have to pay 10%. Your buyer will pay you 10% of your sale price (£19,500). You'll be expected to pay £39,500, so you'll need to add £20k from your savings to the £19,500 your buyer gives you (well, your solicitor).

If you can't do that (many people can't when they're mid chain), then you need to ask your seller if they will accept a smaller deposit. Ask your solicitor acting for you on your purchase to do this. It's a fairly normal thing and most vendors will say it's fine. 

Just out of curiosity, why do you have different solicitors for your sale and purchase? It's not a typical thing to do, for the reasons you're finding... 

pinkteapot

davidmcn said:

ccfc1972 said:

davidmcn said:

Yes, that's what I'd expect. The additional transfer (from firm A to firm makes the completion timescales a bit tighter though.

When you say "a bit tighter", what do you mean? it may not all happen on the same day?

Every transfer takes time - in theory the bank transfer itself is instantaneous, but there's admin involved at both ends, and people trying to get other completions done. Adding another step in the process increases the risk that it might not all happen on the same day.

It should be added that it's very rare for completion to take more than one day, even in long chains where money has to pass from step to step up through several parties. Adding one extra bank transfer is like making the chain one house longer - not really that likely to cause a problem. I've been mid-chain in a chain of 5 families before and legal completion was still finished well before 12noon. 

That's not to say things can't go wrong. But it is very unlikely. 

OP - just one thing. If you complete on your sale before your purchase (i.e. days/weeks/months before), and move into temporary accommodation, the equity from your sale will be transferred to your bank account by the solicitor acting for your sale. In that case, you will then need to transfer money to the solicitor acting for your purchase, per the completion statement. Be careful if you end up with just a few days between the two completions - some solicitors are a bit slow at sending sale proceeds and they don't always arrive with you for a few working days, then you need to allow time to transfer it onward to the second solicitor.

davidmcn

Are you exchanging either contract prior to completion? 

ccfc1972

Thanks for the replies.
The plan currently is to exchange contracts in the first week of Jan with view to complete on the 15th Jan.
The reason we have two solicitors is that we started our house sale well before our purchase. We used the same solicitor that we used when we bought the house. Once we found a house to buy and arranged the mortgage with Lloyds, they insisted that we use a solicitor that was on their panel, so we had to instruct another one. All a bit messy.

Slithery

ccfc1972 said:

The reason we have two solicitors is that we started our house sale well before our purchase. We used the same solicitor that we used when we bought the house. Once we found a house to buy and arranged the mortgage with Lloyds, they insisted that we use a solicitor that was on their panel, so we had to instruct another one. All a bit messy.

Wouldn't it have been far easier for your current solicitor to just join Lloyds' panel?

ccfc1972

Slithery said:

ccfc1972 said:

The reason we have two solicitors is that we started our house sale well before our purchase. We used the same solicitor that we used when we bought the house. Once we found a house to buy and arranged the mortgage with Lloyds, they insisted that we use a solicitor that was on their panel, so we had to instruct another one. All a bit messy.

Wouldn't it have been far easier for your current solicitor to just join Lloyds' panel?

Not really sure how all that works...assume they'd have to apply and be vetted etc 🤷‍♂️

Thrugelmir

You need to have a conversation with both sets of solicitors and discuss the practicalities. 

Tiglet2

Alternatively, changing lender to one that was on their panel.