this video I want to take a look at deposits when you're buying a property
what is the position about getting a deposit back when this is become
unattainable when I said forfeited so let's take a look firstly you need to
remember that there are two types of deposit one is a booking deposit the
other is the contract deposit booking deposit is a payment that you
make to the auctioneer and this is essentially an indication of your
willingness by the house at a particular price but the booking deposit it's fully
refundable the auctioneer should be licensed bonded or licensed with
professional body so there's a bond or an insurance form there or sort of an
insurance or bond scheme that even if in the worst-case scenario an auctioneer
somehow whenever a business or something you're still entitled to get your
deposit back and it is bonded so you really shouldn't have any real concerns
about getting at the book in the process back from an auction here you can change
your mind about a particular property for good reason bad reason or no reason
so it's paid to the auctioneer and it's fully refundable if you change your mind
or if you're unable to proceed for whatever reason contract deposit then is
a different animal it's paid me a sign and return the contracts for sale it's
typically 10% of the purchase price so if the purchase price of the house for
example that you're buying is 200 thousand then the contract deposit will
be 10% of that just twenty thousand you may already have paid a booking
department of five thousand to the auctioneer therefore the contract
deposit that you have to pay when you sign the contract will be fifteen
thousand that is 20 grand less five grand the contract deposit will be gone
you will forfeit if you are unable to complete the sale unless however you
can't your solicitor have made the contract subject to finance
quite frankly nowadays in 2017 most residential purchases most
residential contracts will have a subject
it's closed in them that basically means that if the buy just come through with
the money then you are off the hook you will get your money back and the deal
will not go ahead however that's assuming that it's a subject finance
clause in the contract if you were foolish enough to sign a contract and
not get finance well then you could be in a difficult position because you
never had any finance in place to begin with but by and large if there is a
subject of finance clause in the contract and your solicitor when acting
for a purchaser will look for this to be inserted well then you will get your
deposit back you know their circumstances though if for whatever
reason the vendor solicitor doesn't agree with putting that card in then you
do run the risk of losing your contract deposit if you are unable to complete
the transaction so if you're unable to complete the transaction the vendor will
serve you with an orders to complete and if you're unable to complete then within
the specified timeframe you'll forfeit your deposit and the vendor will have
rescinded the contract you can also sue you for consequential damages arising
from your failure to complete the transaction so these are damages or
costs that arise directly as a result or consequence of your failure to complete
however if it's subjected to finance then you may well be okay buying an
option on the other hand would not be a subjected to finance situation it will
not be a subject to finance contract you must do your due diligence before you go
to the contract or before you go to the auction and there's no booking deposit
you sign the contract and you pay 10% deposit there and then and will not be
accepted to insert a subject to finance clause in that contract so if you cannot
complete you will forfeit your deposit so do your research very carefully
before option I'd be absolutely certain you want to purchase that property and
that the legal title all the legal documents planning etc is in order
my name is Tara Gauri I am a solicitor in Enfield County Meath if you find this
video useful you might give us a thumbs up down below and you might be
interested in subscribing to my youtube channel I have a lot of videos on my
youtube channel about all aspects very slow including quite a lot about Irish
property law