Sales contract

[sellingupslow]

Hi!

We're selling our house and have just been sent the contracts to sign. On the contract there is a section which states

Contract rate: 4% above the base rate for the time being of of the Yorkshire Bank PLC.

Can anyone advise what this means please?

It's principally aimed at situations where the buyer competes late. Interest is charged at more than the bank base rate (ie currently 0.5%) as an incentive for the defaulting party to get a move on. The reference to the Yorkshire Bank is likely to be because that's the bank the seller's solicitors use but all normal high street banks have the same base rate as it's tied to the Bank of England base rate. So, if the buyer is late, he'll be charged 4.5 % interest.

Sorry, that was a very dry and boring explanation!