Paying stamp duty solicitors etc

Glamazon

Hi
Wonder if someone can help.

I am set to exchange contracts on a house next week - this is probably really obvious but.......................

1. I have to send my solictor a cheque for the deposit - does the cheque have to have cleared before we exchange?
2. When do we pay the stamp duty?
3. When do we pay the solicitors?
4. Do they invoice us and give us 7 days to pay?

My deposit has just about cleared me out so wanted to know when the above needed to be paid.

Thanks :A

poppysarah

Why don't you give your solic a bell and ask them. I'm sure the secretary will be able to explain what you should be doing.

chachi

1) yes
2) upon completion
3) upon completion
4) it varies, check with yours for their T&Cs on such

Richard_Webster

If you are getting a mortgage it is the solicitor's responsibility to make sure he has enough money to pay the SDLT (new name for stamp duty) and Land Registry Fees before he uses the mortgage advance money to complete the purchase. The lender expects its mortgage to be registered and that can't happen unless the SDLT and LR Fees have been paid. If a cheque bounces then the solicitor is stuck with finding the money for these and claiming it back (if he can) from the client. So I think you will find that the solicitor will invariably want any payment cleared before completion.

minigirl

Yes the deposit should be cleared before exchange. Stamp Duty and costs should be paid to your solicitors a day or two prior to completion. I would check with your solicitors as to whether they will give you 7 days to pay although I expect they will require it prior to completion. You wouldn't believe how hard it is to get hold a client once a transaction has completed!

LillyJ

Thanks for this, this is something I had been wondering myself! I take it the deposit gets paid on exchange?
We have paid the solicitors some money already for searches etc (£271 I think?).

minigirl

LillyJ wrote: »

Thanks for this, this is something I had been wondering myself! I take it the deposit gets paid on exchange?
We have paid the solicitors some money already for searches etc (£271 I think?).

Prior to exchange the Solicitors should draw up a completion statement setting out the costs, disbursements and advance to be received from the mortgage company (if applicable) and let you know the balance due to complete. This statement should take into account any money already paid on account. If the balance is more than 10% then you can just pay the 10% to the Solicitors and upon clearance of this they will then exchange. The balance then due should be paid a day or two before completion. If the balance is less than 10% then it should all bepaid to your Solicitors and, again, upon clearance exchange will take place.

On exchange the sellers' solicitors will decide as to whether the deposit shoudl be paid over or whether it should be 'held to order' which means the buyers' solicitors just hold onto it until it is required which is usually just until completion.

Hope this helps (and makes sense).

minigirl

minigirl wrote: »

If the balance is more than 10% then you can just pay the 10% to the Solicitors and upon clearance of this they will then exchange. quote]

I meant to add, if the balance is more than 10% of the purchase price.

AJ1982

Hi, good luck with the purchase, heres my experiences from a recent successful completion...

1. I have to send my solictor a cheque for the deposit - does the cheque have to have cleared before we exchange?

Yes, the funds must be in the solicitors account and cleared, in order for exchange to take place, if you have a spare couple of quid lying around, then CHAPS could be a good friend to you here. Ask your bank, Halifax charge around £25 per transaction, of course if you are a colleague, then you get the special discount rate (Free), or you may choose to BACS the monies. Cheuque or BACS, i tend to find if you have to re-issue it, then can delay by a further few days... CHAPS, I found to be very straight forward. Your bank will know all about this.

1. When do we pay the stamp duty?

This was part of the completion statement, so after exchange, I was sent a final bill to cover the remaining value of the propery, including my own funds, mortgage funds (Tho they bypassed me and drew this straight out, didnt even get a feel for the money) as well as the legal fees & SDLT, as well as any other fees (Eg leasehold service charges yada yada)

1. When do we pay the solicitors?

Mine was before completion, as above... one lump sum. Didnt really ask about paying later, depends how much u trust ur solicitors...

1. Do they invoice us and give us 7 days to pay?

See above, mine was a no. Depends on ur solicitors.

Enjoy the new property...