Hi again. I was just musing to myself how well solicitors must do out of holding deposits for houses. Apart from usual conveyancing fees +extras ,given that it can be weeks on end between deposit giving and completion , and that at any one time a solicitor is presumably handling a fair number of house sales, isnt that like having an extra £100k-£150k+ or so in their deposit account on probably most days of the year? An extra £5/6k even with low interest rates to divvy up as a Chrissy box? Someone cheer me up and trash the theory please-my brain is nearly boiled anyway just getting through this house buying lark. completion finally on the 19th though with any luck. Yeah!!!
The solicitor has to hold the money in a 'clients' account and have to give any interest earned to the client. The Solicitor cannot put money into his 'office' account to earn money on it.
The solicitor has to hold the money in a 'clients' account and have to give any interest earned to the client. The Solicitor cannot put money into his 'office' account to earn money on it
I wish! My solicitor had the proceeds from my house sale for over a week while a cheque was prepared and wended it's way to me then on to my bank account. Ditto when I purchased - I forwarded the dosh but with one delay after another he had that for almost a week too!
A friend of mine did get the interest on the proceeds of her dead mother's house when the solicitor had it for a week so I'm not saying it doens't happen but I think Cypriana's and my experience is more the norm.
Related to this is the issue of rental agencies holding deposits and paying no interest. Now there's a great source of interest for them. It's good practice for them to give the interest to the tenant but there is no legal compulsion. Cherry on the cake ... I have a short-term let using up the remainder of my 6 month lease on the rental I was in - so the agent has TWO deposits. Again, nothing illegal. The bad thing is that such things happen when you have least time and energy to fight over them.
I hear what you are saying, but trust me, the Solicitor has to have 2 bank accounts, office and client, some clients have their own client account, in particular estates.
That's the law, but hey, mistakes happen, and if the money went into the Solicitors office account, the annual audit will pick that up.
Originally posted by stateofplay: The solicitor has to hold the money in a 'clients' account and have to give any interest earned to the client. The Solicitor cannot put money into his 'office' account to earn money on it.
Which client ? Its the vendors solicitor who is holding my deposit and has done for weeks whilst the flat still isnt mine til the 19th. Does he give my interest to my seller then?
Just to pick-up on Landlords Deposits....... New Law coming in shortly whereby the Landlord cannot hold their Tenants deposit. Now, I wonder which bunch of money grabbing National Letting Agents pestered Government for that ruling! Personally I do not hold Tenants Deposits, no arguments then at the end of the Tenancy and it is worth considering on a individual basis, the amount of interest earned is minimal and if ever it was an issue, as far as I am concerned, the Tenants can have the interest held on the deposit. Mel.
Originally posted by stateofplay: I hear what you are saying, but trust me, the Solicitor has to have 2 bank accounts, office and client, some clients have their own client account, in particular estates.
That's the law, but hey, mistakes happen, and if the money went into the Solicitors office account, the annual audit will pick that up.
SoP is correct. The handling of such monies is very tightly regulated. It has to be kept separate, and any interest earned passed on to the owner of the money... however... there is no obligation on the Solicitor to put the money into an interest-earning account. Generally they do not. They just put it into a holding account that has essential facilities allowing quick transfer &c rather than less important (in the wider scheme of things) perks such as Interest.
Ary.
-------------------------------------- ***Do not, I repeat Do NOT feed the Trolls! *** *** All Hail the mighty hamsters! ***
I wish! My solicitor had the proceeds from my house sale for over a week while a cheque was prepared and wended it's way to me then on to my bank account. Ditto when I purchased - I forwarded the dosh but with one delay after another he had that for almost a week too!
Last time I sold, my solicitor gave me the option of paying £25 to get the money transferred straight into my bank account via the CHAPS system - well worth the cost for the extra interest earned as a result of the punctual arrival. when purchasing, solicitors have to be sure that the money is available on the day of completion, so probably err on the side of caution - tho loss of a day or two's interest is probably preferable to being unable to compete on time, with the potential penalties that you could incur as a result.
All Hail the mighty hamsters! 
