Do I need a bridging loan? Panicking

[Deleted User]

Hi folks can I pick your brains again please?

I am selling a flat with 51k equity and buying a house. The purchase is being made up of mortgage and equity. My understanding has always been that the sale money and mortgage money come in to the solicitor and that goes up the chain to pay the vendor. Is this right? I've just received an email from my solicitor saying that 'any further funds you are putting into the purchase will be requested between exhange and completion' so of course now I'm panicking. I've queried this but while im waiting for a reply can anyone put my mind at rest please?

Thrugelmir

If you are not putting in additional funds then there's nothing to be concerned with.  Most likely a standard wording. 

saajan_12

Purplepenguin70 said:

Hi folks can I pick your brains again please?

I am selling a flat with 51k equity and buying a house. The purchase is being made up of mortgage and equity. My understanding has always been that the sale money and mortgage money come in to the solicitor and that goes up the chain to pay the vendor. Is this right? I've just received an email from my solicitor saying that 'any further funds you are putting into the purchase will be requested between exhange and completion' so of course now I'm panicking. I've queried this but while im waiting for a reply can anyone put my mind at rest please?

The solicitor will need money to cover 
* Purchase price
* SDLT
* EA fees on sale
* Solicitors costs
* Mortgage & survey fees

The funds expected at completion are
* equity in flat (51k)
* new mortgage

Does the total of the second list cover the first list? If there is a gap, then that's what you'd need to make up - typically just the fees

[Deleted User]

Thanks that's put my mind at rest...its so stressful!

pinkteapot

If you aren’t exchanging and completing on the same day, what you do need to do if you’ve not already is check that your vendor is happy with 10% of your sale price as a deposit, instead of 10% of what you’re paying them. 

If possible you ‘top up’ the deposit on exchange that you receive from your buyer to 10% of your purchase price, but if you can’t you need to negotiate a lower deposit with your seller (not usually a problem as your situation is very common). 

saajan_12

pinkteapot said:

If you aren’t exchanging and completing on the same day, what you do need to do if you’ve not already is check that your vendor is happy with 10% of your sale price as a deposit, instead of 10% of what you’re paying them. 

If possible you ‘top up’ the deposit on exchange that you receive from your buyer to 10% of your purchase price, but if you can’t you need to negotiate a lower deposit with your seller (not usually a problem as your situation is very common). 

That would be before exchange. OP's solicitor is talking about between exchange and completion. 

pinkteapot

I know. OP didn't say they've exchanged though - it's not clear where in the process they are, so just in case they're not there yet and this hasn't been discussed yet, to save another panic. 

[Deleted User]

Thanks all, I've just started the process. Yes my EA is fairly confident the 10% from my buyer which comes to 8% for my vendor will be ok.

Yes sajjan equity and mortgage cover everything. Thanks  I'm alot calmer now, had a good chat with my EA who was also very helpful.