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Deposit

An amount of money which must be paid at the time of exchange of contracts (or to reserve an option to purchase). It may be between 5% and 10% of the purchase price although 10% is normal. In order for a solicitor to exchange contracts, the deposit must be “cleared funds”.  If the buyer pays less than 10% and is unable to complete the transaction he/she forfeits the full 10% deposit and the seller can keep it together with interest and any other losses incurred as a result of late completion.

 

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