by multisync1830 »
25 Sep 2013 12:26
Green Nameless It's no different to putting a deposit on a house - fail to complete the deal and you lose your deposit so the vendor keeps the house and keeps your deposit.

Shocking analogy.
The deposit is just the difference between the mortgage and the total value isn't it? Not sure the vendor has any right to it if the deal collapses. I think they can probably sue you for expenses if it falls through after exchange or something but the deposit isn't automatically theirs.
You really shouldn't be calling something a 'shocking analogy' if you really don't know what you are talking about.
The deposit is a sign of intent to buy. Normally 10% of the property value. It has nothing to do with the mortgage.
Exchange of contracts
The final contract between you and the seller is prepared when:-
•the solicitor (or licensed conveyancer) and you are satisfied with the final outcome of all the enquiries
•any surveyor’s report has been received and any necessary action taken
•the formal mortgage offer has been received
•arrangements about the payment of the 10% deposit have been made
•the date of completion has been agreed.
You and the seller each have a copy of the final contract which you must sign. These signed contracts are then exchanged. At exchange of contracts both you and the seller are legally bound by the contract and the sale of the house has to go ahead. If you drop out, you are likely to lose your deposit.
of course the analogy doesn't work exactly as a deposit is not the same as a half share but the basic premise is the same. There was an intent to buy 100% and if the buyer fails to complete he could be deemed in breach of contract. The offer of half for a quid may be seen as bravado if it were there at the beginning or if introduced now a way of stalling for more time to find the remainder