contract signed but no deposit..

I

igloo

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I currently have a buyer for my 3-bed house and apparently contract has been signed by them (per the agent), but not yet received by my solicitor. The agent requested we give access to the house to the buyer to allow them store some furniture - they are very keen for sale to go through, and we do not currently live at the house.
However, I was also advised that they do not have a 10% or substantial amount to put towards deposit on the sale! My solicitor thinks this is very unusual and is not comfortable with legalities being closed unless a deposit is furnished. Apparently they are trading up and have their property for sale as security against the purchase of our house. The agent advises this is normal practice these days..

What say you folks?
 
My opinion- do not allow access. Completely aside from the legal and insurance ramifications, as long as they don't have access it keeps the pressure on them to complete quickly. Also if they really wanted to they could get a personal loan to pay a deposit- I don't think I would feel comfortable relying on a contract without deposit. I assume the contract is unconditional- ie that they have not inserted a condition that the purchase is subject to the sale of their own home?
 
Vanilla said:
I assume the contract is unconditional- ie that they have not inserted a condition that the purchase is subject to the sale of their own home?
Click to expand...

Thats correct, our solicitor drafted a contract with a clause for 10% deposit. I can't understand why the buyer, in getting loan approval, DID NOT allow for deposit and other outlay like stamp duty, their own solicitors fee etc.
 
It is not all that unusual these days to have purchasers suggest a deposit of less than 10% and sometimes in all circumstances it is ok to agree to this but 10% is still the norm.

Under no circumstances should you agree to there being no deposit and Vanilla is absolutely correct that you should not allow access for storage etc...

If they want to pay a lesser deposit you can consider this although I agree with what Vanilla says as to them getting a loan for this. However if you are agreeable to less than 10% it must still be substansial (so that they cannot afford to have it forfeited) and should cover all auctioneer fees and outlays and legal fees and outlays and then some. I would never recommend that a deposit less than 5-6% should be accepted(and then only in exceptional circumstances).

The reason lesser deposits are offered and sometimes accepted these days is due partly to 100% mortgages and partly due to the fact that the concept of saving for a deposit went out of fashion at the height of the market as people rushed to get on the ladder as quickly as possible.
 
If they are trading up and have not yet sold their own house it is possible that they wouldn't have a 10% deposit. Say your house is €400,000 then they need to be able to hand over €40,000 as a deposit. Not that easily done.
Of course they could get a loan to use as the deposit, but they may be reluctant to make repayments on a large loan and keep paying their own mortgage while they wait to sell their own house (which may be a while).
I think the other posters are right when they say you must have a large enough deposit from them to ensure that they go through with the purchase. Whether you insist on the full 10% or not is up to you.
Letting them store furniture is another issue and certainly shouldn't be contemplated before contracts are signed and a deposit is given. Have you spoken to the buyers yourself or is all communication done through solicitors? Sometimes direct contact can help to sort things out.
 
don't let them gain access, for one your insurance won't cover it.
instruct your solicitor to say access will not be granted until Final cheque goes through.

eedited to say: one of my friends was selling to my other friend. and as they were friends agreed there was noproblem storing furniture. however the solicitors came back and said it wasn't allowed for various reasons until final cheque was paid...

err on the side of caution

it ain't usual these days--- i haven't heard of it anyway
 
without a deposit, the signed contract is not enforceable in contract law (there must also be a financial consideration for a valid IRL contract), our solicitor must press for a DEPOSIT, else the buyer could pull out at closing

do you really want to give access now kwowing this...............
 
Thanks to all, your sentiments reflect my own opinion entirely. All comms need to be done between solicitorsr, I have instructed the agent on this. I'm a little fed up though as house has been on market 5 months and these buyers are first to make an offer on it. A 5k booking deposit was paid to agent about 4 weeks back.
 
booking deposit is not the same as a nonrefundable contract deposit - a lot of buyers are holding off on these currently as the market stalls / falls
 
Why would they want to store furniture if they have not sold their own house? Also how can they sign a contract with you to purchase without a clause that it is conditional on them selling their own house as they don't appear to have even enough savings to put down a 10% deposit - if their house sale doesn't go through how are they going to pay you?
 
Aileen, these were my thoughts too when I heard from our agent. Since then they have signed contracts and requested to close tomorrow..! So we can do this only if they furnish the loan cheque and do everything in the one go i.e. we (vendor) sign contract, sign the deed of transfer and they (buyer) hand over loan cheque.
 
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