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Exchange deposit

CommStone
CommStone Posts: 9 Forumite
Sixth Anniversary First Post Combo Breaker
in Mortgages & endowments
Hi there,
I have a question - simplified example to follow.
If I am buying a house for £550,000 and selling my current mortgage free house for £300,000. I need and have a AIP for £250,000 for the difference. (Assume I have the cash for all the fees and SD). 
Do I have to put up a 10% deposit at exchange of contracts, or is this somehow magically dealt with as I have the equity in the house I am selling. 

Comments

  • K_S
    K_S Posts: 6,893 Forumite
    1,000 Posts Fourth Anniversary Photogenic Name Dropper
    edited 26 February 2021 at 2:43PM
    @Commstone It's one of the following, usually No.2 as people in the chain agree to use the deposit from the person below. And most homemovers' equity is usually tied up in the property.
    1. You use the 10% exchange deposit from your buyer and add cash to hit the 10% required by your seller
    OR
    2. You agree through the solicitor for a reduced deposit to your seller and just use the 10% from your buyer.

    I am a Mortgage Adviser - You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. 

    PLEASE DO NOT SEND PMs asking for one-to-one-advice, or representation.

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