Buying house, deposits mortgage...

M

MrChris

Guest
Hi,
Wasnt sure how to explain this in title! We have had an offer accepted on a house of 225k. The mortgage will be 92%, so 207k with the other 18k being our own. My question is, in buying a house there is the booking deposit to the EA. Then we have the deposit at contract which I am told is 10% minus the booking deposit. I take it this 10% comes of the cost of the house, but does it come out of the mortgage or is it again out of our pockets. Just a bit confused :) If we get 92% mortgage of 207k, but paying deposit of 10% then surely we should just be getting 90% mortgage? (Probably a ridiculous question :) )

Thanks.
 
I think what will happen is that you give 10% deposit to your solicitor, he will then pay the 8% + your 92% mortgage, then take his fee out of the remainder and give you back whatever is left (I'm open to correction though)
 
You should get your solicitor to confirm all these numbers, but here is my summary.

The seller will expect a deposit of approx 10% on signing the contract, but the mortgage money will not have been paid out by then. You need to fund this yourself.

So, the numbers look something like this

First, you pay out 2K EA deposit ( my guess)
On signing contracts, the seller wants a deposit of 22.5K. You must pay this in cash, through your solicitor.

I think the EA passes their deposit to the solicitor on signing, to make up part of this deposit but you should confirm this. If not, you need to have 22.5K in cash, for the deposit.

When the sale completes, the solicitor will get a mortgage cheque for 207K. He will pay the seller the remaining 202.5K, take his fee and return the rest to you.

If you can't cover the full 10% deposit, in advance of getting the mortgage cheque, you can ask if an 8% deposit is acceptable.
 
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Yeah that all makes sense. We have the cash for the deposit I just got confused amongst the world of deposits :). Thanks very much for the replies guys. Will be talking to the solicitor in the next few days, was just bugging me :)

Cheers!
 
EA will actually take his fee out of the booking deposit and pass the balance to the vendor on closing but from purchaser's point of view it is counted as part of his 10% contract deposit so he will need to give his solicitor a further 20,500 to make up the 10% (assuming 2,000 booking deposit)
 
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