When Do You Transfer Deposit to Solicitor UK

One of the most important financial steps in the property buying process is paying the deposit. For many buyers, the deposit represents a significant portion of their savings, so it is natural to want clarity on when exactly it must be transferred to the solicitor. The timing is crucial because the deposit must be available on the day of exchange of contracts, which is the point when the transaction becomes legally binding.

The Role of the Deposit in a Property Purchase

The deposit is usually ten percent of the purchase price, although in some cases it can be higher or lower depending on the terms agreed. Its purpose is to demonstrate commitment to the purchase and provide security for the seller. Once contracts are exchanged, the buyer cannot withdraw without risking the loss of the deposit. Because of this, solicitors handle the deposit on behalf of their clients to ensure it is transferred safely and securely at the correct time.

When the Deposit Is Transferred

In practice, the deposit is transferred to the solicitor shortly before the exchange of contracts. Your solicitor will inform you of the exact amount required and provide their client account details for payment. They will usually request the money a few days in advance of the planned exchange to ensure that cleared funds are available and to avoid delays caused by banking processes. This means you should be prepared to move the money once your solicitor gives you notice that the exchange is imminent.

How the Solicitor Uses the Deposit

Once your solicitor has received the funds, they will hold the money in a regulated client account until the moment of exchange. On exchange day, they transfer the deposit to the seller’s solicitor as part of the formal process of exchanging contracts. This ensures that the funds are secure and properly accounted for, and it also provides the seller with reassurance that the buyer is fully committed.

Why Timing Matters

The timing of transferring the deposit is critical because if the funds are not in place, the exchange cannot happen. This can delay the entire transaction and, in a chain of linked sales, may cause problems for multiple parties. Solicitors often advise clients to transfer the deposit well ahead of time, especially if it involves moving large sums, as same day transfers can sometimes be delayed due to bank cut off times or security checks. Planning ahead reduces stress and ensures the exchange goes smoothly.

Conclusion

You are usually required to transfer your deposit to your solicitor a few days before exchange of contracts so that the money is cleared and ready. Your solicitor will then send the deposit to the seller’s solicitor at the moment of exchange. Having the funds in place on time is essential to avoid delays, and buyers should always follow their solicitor’s instructions carefully to ensure the process runs without issues.