Paying deposit to vendor

[Munchkin]

Does the deposit have to be paid through the vendor's solicitors or is it possible to just pay it directly to the vendor?

 

[westminster]

Its my understanding it needs to go into a Trust account of a trusted source. If you made it out to the Vendor they could just go and spend it and if finance fell through you wouldn't be getting your money bank.
My last deposit cheque was kept by the real estate agent in their trust account until Settlement. Then it is put into the kitty at Settlement for the disbursement of everything.

 

[Munchkin]

Do you know if it is actually a law or anything? Or if it is just not generally considered a wise idea?

There is a bit of a tricky situation going on and just trying to find possible solutions.

 

[vaughan]

There is a bit of a tricky situation going on and just trying to find possible solutions.

Get your solicitor to sort it out, that's what you pay them for. If you have used a conveyancer: get a solicitor.

 

[Munchkin]

It's not an issue they can sort out, other than answering this question for me. will be asking first thing tomorrow but just thought I'd see if anyone here knew the answer tonight.

 

[Qlds007]

Certainly you can pay it to the Vendor or even agree with the Selling Agent / Vendors Solicitors that the deposit can be released immediately to the Seller.

The question is why would you?

 

[Munchkin]

Because it's my brother and he needed the money urgently

 

[Munchkin]

We just weren't sure if there was some kind of rule against it or anything, for any legal reason

 

[Qlds007]

No legal reason whatsoever why you can't.

 

[CHAOS]

My hubby sold his 50% of an IP to his brother. No deposit changed hands. He was given a cheque by his brother when transfer was done. Just what they agreed to. Quick settlement - done as soon as conveyancer could organise the paperwork.

If you trust your brother then pay him the deposit. The solicitor can take down the details of the transaction.

If you have some doubts:
How long is the agreed settlement? Short or long? Why does he need the money so badly? What happens if he blows the deposit and decides not to sell you the house - you would have to sue him to recover the deposit. I know it is family but I would still assess the risk. If he didn't need the money would he be happy for you to pay 0 deposit until settlement and leave it in an offset account?

 

[Munchkin]

he wasn't fussed about the deposit which is why we hadn't paid it previously. he now needed it in order to purchase another property and we are already living in the property we are purchasing off him. it all got a bit complicated for reasons i'd rather not post, which is why he needed the money now rather than later.

 

[Terry_w]

If the sale is proceeding by contract then you would also need to make sure there are no provisions in the contract that the deposit is to be held by an agent or in a trust account etc.