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Home  /  How Your Money Moves  /  Where Your Money Is

Where your money actually is.

The question nobody likes asking out loud: you are about to send a large sum to a country you may never have visited — who is holding it, and what stops them disappearing with it? Here is every stage, who has the money, the rule that protects it, and the honest answer to what happens if that person fails.

01

Reservation

Typically £2,000 – £5,000
Held by: The seller or developer, or their agent

This is the one stage where the money is usually NOT ring-fenced. A reservation fee is normally paid straight to the developer and is often non-refundable after a short window.

The ruleNo statutory protection. What governs it is the reservation form you sign — the refund window, and what happens if the seller withdraws. If it failsIf the scheme collapses before exchange, a reservation fee is usually an unsecured claim. This is why it is small, and why we read the form before you sign rather than after.
02

Exchange of contracts

Usually 10% of the price
Held by: Your own solicitor, in a client account

A solicitor's client account is legally separate from the firm's own money. It cannot be used to pay the firm's bills, and it cannot be lent out. Your deposit sits there, in your name, until completion.

The ruleSRA Accounts Rules — client money must be kept separate, available on demand, and reconciled at least every five weeks. If it failsIf the firm fails or money is taken dishonestly, the SRA Compensation Fund can reimburse clients. That is what a regulated solicitor buys you, and it is why we will not work with an unregulated 'conveyancing consultant'.
03

Off-plan only — stakeholder or agent

The exchange deposit, sometimes more
Held by: Depends entirely on one clause

Held as STAKEHOLDER, the deposit cannot be released to the developer before completion. Held as AGENT for the seller, the developer can spend it the day it arrives — on building the scheme.

The ruleThere is no law forcing stakeholder. It is a contract term, and it is the single line that decides whether your deposit still exists if the developer fails. If it failsThe documented off-plan collapses are all the same story: deposits held as agent, spent on construction, and recovered at pennies in the pound. We ask this question in writing before you exchange.
04

Completion

The balance, plus stamp duty and fees
Held by: Your solicitor, then the seller's solicitor

The money moves solicitor to solicitor on the day. Yours will not release it until the title checks are clear and the lender's funds are in place.

The ruleSRA Accounts Rules again on the way through, and the Law Society's Code for Completion — the seller's solicitor undertakes to discharge any existing mortgage. If it failsThe known danger here is not the solicitor but a fake email changing the bank details. Every firm now confirms account details by phone, and you should never act on a change of details sent by email.
05

The property is yours

The asset itself
Held by: You, on the register

Your solicitor registers you as proprietor at HM Land Registry. Until that entry exists you own the property by contract; afterwards you own it on a public register that anybody can check, including you.

The ruleLand Registration Act 2002. Registered title is state-guaranteed, and there is an indemnity scheme if the register turns out to be wrong. If it failsRegistration can take months at the Land Registry's own pace. Your ownership is protected from the moment of completion by a priority search your solicitor lodges beforehand.
06

New build — after you own it

The build quality, not your cash
Held by: The warranty provider

A new home warranty covers structural defects for ten years, and deposit loss on builder insolvency before completion — but typically only to 10% of the price, capped, and for the first owner.

The ruleThe warranty policy terms. NHBC Buildmark, Buildzone, LABC and the rest differ, so the cover is whatever that specific policy says. If it failsA warranty is not a guarantee that the building is good. It is a claim you can make if it is not — which is why we look at the developer's record as well as the policy.
Protected by regulation Depends on the contract — we check it Not protected — keep it small
Check it yourself

You do not have to take our word for any of this.

Four public registers. All free, all open to anyone, and all of them will answer a question about us as readily as about somebody else.

Is my solicitor actually regulated?

Every practising solicitor and firm is on a public register. If they are not on it, they are not a solicitor.

Check the SRA register

Does the register show who owns it?

HM Land Registry holds the title, the price paid and any charges on it. Anyone can buy a copy for a few pounds.

Search HM Land Registry

Is the company real?

Incorporation date, filed accounts, directors, and whether anything has been struck off — all public, all free.

Search Companies House

What if a solicitor takes the money?

The SRA Compensation Fund exists for exactly that, and is one of the reasons the profession is worth using.

How the Compensation Fund works
The two rules worth remembering. First: your deposit should sit with your own solicitor, in a client account, not with a seller, an agent or an introducer — and never in a personal account. Second: nobody legitimate changes their bank details by email. If you receive a message saying the account has changed, it is fraud until you have confirmed it by telephone on a number you already had.

This page describes how the money is protected in a normal UK purchase. It is not legal advice, and your own solicitor is the person to confirm the position on your specific transaction — which is exactly the point of having one.