When do you pay the deposit for a property?

[motherofallhangovers]

When are you expected to pay the deposit? Is it when you make the offer or later in the sale (e.g. after the survey?)

What happens with cash buyers?

TIA :)

on exchange iirc

Deposit is usually paid when you exchange contracts

On exchange of contracts. Balance payable on completion - however the purchase is financed.

Ooh thanks, such a quick response!

So a deposit it more to do with the lender than the seller then?

In a cash sale there would simply be no deposit?

Hold on a second (sorry excuse the stupid questions!)

What's the difference between exchange of contracts and completion? I thought it was the same thing?!

We paid ours when the draft contract was sent to our solicitor, but we weren't in a chain .

At what point in the process do you exchange contracts?

We won't be able to come up with any cash till our place sells. What I'm really wondering is when we'll be in a position to make offers.

If someone has offered on our place and we've accepted it, is that enough?

hopeful bump :)

Anyone can offer, your offer probably won't be accepted if your not proceedable.

You exchange contracts and 10% deposit, and buy building insurance, normally complete 2 weeks later and you pay the final 90%.

When did you last buy/sell?

We are in the process of buying a house. As it happens I was just looking through the buyers guide our solicitor has sent us. It says a 10% deposit is payable at exchange of contracts and the balance is due on completion.

We have sold our house and are just at signing the contracts now, then they will be 'exchanged' between both solicitors. I think then its legally binding.

We waited to put in an offer on new house until we had accepted offer on our house.

Hope this makes sense, I am no expert whatsoever, have all these questions myself!

you really need to get an offer on yours before you can put an offer on anyone elses. They can accept an offer before that but will probably keep it on the market.
If yo have property to sell, at the point of exchange the deposit for your new house wil come from the deposit of the people buying yours. ie you dont actually put money down until completion.

Op if your house sells for £100k, you will have £10k on exchange deposited with your solicitor which they give to the vendors of your new home. If you are buying a new home for £200k, you need another £10k of your own money to deposit with your solicitor for Exchange.

"When did you last buy/sell?" Last bought 10 years ago.

Have never sold a property until now!

Thanks everyone, this is really useful. I understand how it works now.

We've just received an offer, so if we accept it we'll be able to make offers now. Then when they pay us the deposit we'll pay ours (I'd forgotten about their deposit! ). Their deposit will be enough for ours.

Then we complete some time later.

Great :)

I have never added to my deposit, even though the buying house price has been much higher than the selling one. I think the solic uses the equity for deposit?

When you exchange contracts their solicitor will pass the deposit to yours and then yours in turn pass it to your buyer. After this is is highly unlikely that anyone will pull out as they would lose their deposit. So you are pretty safe then. Also you don;t exchange until all paperwork, surveys, land registry blah blah is done, so anyone can pull out at this stage.

What position is your buyer in? If they are in rented/living with family, first time buyer or cash buyer they are good. If your buyer is in a chain of several people it weakens you.

First time buyer so no chain.

Thankfully! :)

The deposit is 10% of the purchase price which you put down on exchange of contracts. The 15% you talk about is the money you're putting in yourself i.e. your equity. If you were a cash buyer, you would have 100% equity but you'd still only pay a 10% deposit on exchange.

It's confusing because banks and the media talk about buyers needing 15 or 20% deposits etc but what they really mean is that they need to have saved up 15 or 20% of the purchase price.

Some sneaky estate agents look for a holding deposit of £1k or £2k when you make your offer - don't ever agree this!