Transferring funds for house purchase

[mylovelymonster]

I have a substantial amount of money to transfer for a house purchase - way more than the FSCS limit. When the money is collected together in solicitor's client account, is this then protected fully? Or does the FSCS limit apply to that account? How do I do this with peace of mind?

[KatieMiddleton]

It's going to be in the account for a couple of days no? I think you're worrying unduly.

It is very unlikely a bank will fail in the next couple of months. They're all very well capitalised and/or propped up by the government.

[whomovedmychocolate]

I don't think the FSCS applies to money held by a solicitor. It will be fine. We had £700K sat with our solicitor for umm four days last year while they arsed about with the contract details!

[mylovelymonster]

Really Whomovedmychocolate? Solicitor's account is in a bank like any other......Will ask him next week. Will take an age to transfer the amount from under my mattress

[KatieMiddleton]

I agree with wmmc. I don't think you're covered under the terms of the FSC scheme for a solicitor's client account. If the bank providing the account failed the solicitor's firm would be able to claim.

If the solicitor makes off with your money that's a criminal matter.

Either way fscs is not something that protects you in this instance.

[mylovelymonster]

Have had a look at Client Deposit Accounts T&Cs on the web - set up for use of solicitors for their clients - and seems the FSCS limits (£85k/£170k joint) apply.
Will check out with the solicitor.

[fridayschild]

The limits do apply. My firm has a clause about that in our standard engagement letter. Also the limit applies to the firm's total account, not to each individual client account within that.

If you are concerned you will have to organise your accounts and your life to be able to make same day transfers on the day. There is a cost to this, and you may have plenty other things to do on the day you buy the house. You need to balance that against the risk of the bank going under for the short period you have your money in the solicitor's account. Remember Northern Rock was widely trailed before it went down. Like others on this thread, I decided although the outcome would have been devastating for me, the risk of that outcome was low enough for me to take. However it is your money and your approach to risk which is relevant here, not mine.

[mylovelymonster]

Thanks for that, fridayschild. I think the account will be with HSBC, which is probably as secure as any.

Does seem that the limits set are woefully inadequate, even if the risk is small.
How to transfer funds another issue I need to look into.......