Interest on money held by solicitor

1

1st house

Guest
Just a quick question - I would appreciate if anyone has experience of this. Im in the process of buying a second hand house and was supposed to close last week. Solicitor requested cheque from bank but on Wednesday the vendor changed closing date to the end of the month at the last minute.
Solicitor then requested bank to cancel the loan cheque in writing apparently and by fax. I followed this up with solicitor the previous evening- he said no cheque had been received and that he would call me if the cheque came in.
Phoned today to see how contracts are progressing and solicitor "mentioned" that the loan cheque had actually been issued which means we are paying interest on a mortgage we dont need ! As he will hold this for more than 7days I requested that we would be entitled to interest on it from Solicitor -however he says this is not the case as he is holding it in trust in a holding account - does anyone know if this is correct ?
Many thanks,
 
What lending institution are you using? Some banks that issue physical cheques don't charge interest until the cheque is cashed rather than printed.
 
The mortgage is with AIB. I talked to them today and they said first repayment is due on July 12.
 
1st house said:
solicitor "mentioned" that the loan cheque had actually been issued which means we are paying interest on a mortgage we dont need ! As he will hold this for more than 7days I requested that we would be entitled to interest on it from Solicitor -however he says this is not the case as he is holding it in trust in a holding account - does anyone know if this is correct ?
Many thanks,
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It is not correct. However, nor is it automatically the case that you are entitled to interest. But I would certainly ask the solicitor to confirm the situation in writing as part of his\her account - and I would ask him\her to have the money on deposit until the end of the month when it is needed.
 
Thanks for that. I will do that
I thought I was automatically entitled to interest after the monies were held for 7days ? Maybe Im dreaming this up :eek:
 
The solicitor is not running a bank, their requirement is that you have the funds available to them in a timely manner. Depending on what type of account the solicitor uses for their holding account, they may accrue interest but it is unlikley that they would have the inclination to calculate and disperse that interest. As the money needs to be available quickly when the purchase closes, it is probably not in a high interest bearing account.

There is no harm in asking but unless you have agreed with your solicitor a rate of interest that they will give you while they are holding your funds, I do not think that you are entitled to it
 
There is a requirement for a solicitor to pay any interest that he receives, however as he is holding it in a holding account which can be accessed immedaitely the amount of interest would be very small - probably less than 0.5%.

Its different if it is held in a client account where he could give the bank 7 days notice of withdrawal and intereset would be in region of 3.5%.

Also I believe if the interest is less than a certain amount the solicitor does not have to evaluate it. (region of €50) - If I can find the exact info, i'll post it.


All info here - limit before solicitor needs to account is €100 (£75)
http://www.irishstatutebook.ie/1995/en/si/0108.html
 
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