Two deposit terms, one property purchase
Your mortgage deposit is the part of the price you are funding without the new mortgage. An exchange deposit is money your conveyancer arranges to pay under the purchase contract when you exchange. It normally forms part of that same buyer contribution: it is not automatically an extra deposit on top.
The amount and timing depend on the contract, your mortgage and where you are buying. Confirm the figures with your conveyancer before transferring money or agreeing to exchange.
What is the difference between a mortgage deposit and an exchange deposit?
Your mortgage deposit
This is your contribution towards the purchase price, separate from the amount the lender will advance. It affects the loan-to-value of the proposed mortgage. The lender still has to assess your circumstances and the property; having a particular deposit does not secure approval.
The exchange deposit
In an England or Wales purchase, this is the part of the price the contract requires at exchange, usually transferred through the conveyancers. Exchange makes the purchase legally binding. The sum paid then is credited towards the price, with the remaining funds dealt with at completion.
The exchange figure can be less than your full mortgage deposit. The contract amount is a legal matter between buyer and seller; the mortgage contribution is a funding matter between you and your lender. Your conveyancer should reconcile both on a completion statement.
Will I need to pay my deposit twice?
No, not in this straightforward illustration. The sum paid at exchange is counted towards your contribution to the price. You may still need more of your own money at completion, as well as tax, fees and moving costs.
Illustration only: a £300,000 purchase
If the contract calls for £15,000 at exchange, the other £15,000 of the buyer’s price contribution is due for completion alongside the proposed £270,000 mortgage advance. The figures deliberately exclude transaction tax and other costs. They are not a lender offer, an agreed contract term or a typical exchange-deposit requirement.
Ask before relying on a smaller exchange payment. A seller may or may not agree to it, and paying less at exchange does not necessarily limit your liability if you fail to complete. Your conveyancer must explain the contract and the money needed on each date.
When does each payment become due?
- Before exchange: agree the purchase price and mortgage route, arrange legal checks and ask your conveyancer for a written statement of funds. A mortgage agreement in principle is not the same as a formal offer. Tell your adviser if the price, deposit source or property changes.
- At exchange: in England and Wales, the conveyancers exchange signed contracts once the required checks and funds are in place. Your conveyancer tells you the contract deposit and how to transfer it. The transaction becomes legally binding, with a completion date agreed under the contract.
- At completion: the conveyancer obtains the mortgage advance and the rest of the money due from you, pays the seller’s conveyancer and accounts for the legal costs and applicable property tax. You receive the keys when completion is confirmed.
If you are selling another property at the same time, some of your proposed contribution may be tied up in that sale. Tell your conveyancer early; do not assume sale proceeds can automatically be used as the exchange payment on your purchase. A new-build reservation or auction can also set different deadlines and terms.
What should you check before exchange?
- The lender position: confirm the written mortgage offer, conditions and any change that needs to be reported.
- The full cash figure: ask for the amount due at exchange, the amount due before completion and separate allowances for tax, legal fees and other costs.
- The source of money: tell your adviser and conveyancer about gifts, sale proceeds, business funds or borrowing. They will say what evidence is needed and whether a proposed source is acceptable for the case.
- The contract and property: ask your conveyancer about searches, title, surveys, insurance, completion date and what happens if you cannot complete.
- Payment instructions: verify bank details using a trusted phone number you already hold for the conveyancer. Do not rely on a last-minute email asking you to change the account.
Count Ready can discuss the mortgage contribution, loan-to-value and evidence a lender may require. Your conveyancer decides the legal payment timetable and should explain the contract risk. Neither role replaces the other.
Does “exchange deposit” mean the same thing everywhere in the UK?
This guide’s worked example follows an England and Wales contract exchange. In Scotland, solicitors negotiate missives; once they are concluded, the contract is binding. The timing of any holding payment and the buyer’s contribution follows the Scottish contract and solicitor’s instructions, so do not apply the England and Wales exchange example to a Scottish purchase. Northern Ireland buyers should also confirm their own contract and payment stages with their solicitor.
The mortgage deposit remains the amount you contribute towards the price without the new mortgage, wherever you buy. The legal milestone and transfer instructions need local advice.
Mortgage and exchange deposit questions
Does the exchange deposit count towards my mortgage deposit?
It is normally part of the buyer’s contribution to the agreed price, not a second deposit. Ask your conveyancer to show the exchange payment, remaining buyer funds, mortgage advance, tax and fees on the completion statement for your transaction.
Is the exchange deposit always 10%?
No. Ten per cent is a common contract convention in England and Wales, but the sum due depends on the agreed contract. A smaller payment needs agreement and may not reduce the consequences if you fail to complete. Check the exact term with your conveyancer.
Can I exchange before I have a mortgage offer?
That can leave you committed to buy without confirmed funding. Government and MoneyHelper buying guidance advise checking that the lender has confirmed the mortgage before exchange. Your conveyancer should explain whether the contract and funding are ready for your particular transaction.
What if my deposit comes from selling my current home?
Tell your conveyancer how the sale and purchase are linked. They can explain what funds are available on each date and whether the contract deposit on your purchase can be arranged through the chain. Do not assume the money will be accessible before your own sale completes.
Who should I ask about the amount to transfer?
Your conveyancer should give the contractual exchange amount, its deadline and verified payment instructions. A mortgage adviser can explain the proposed lender contribution and any deposit-source checks, but cannot set the legal contract deposit.
Know what the lender needs and what the contract requires
Tell Count Ready whether you are buying a home or a rental property, the approximate price, the money available and its source, and where you are in the purchase. We can discuss the mortgage side and help you identify questions for your conveyancer before you commit. An initial conversation is not a mortgage offer or legal advice.
Count Ready’s initial mortgage evaluation has no fee. See the Terms of Business for the fees that may apply if you proceed.
Sources and scope
- GOV.UK: How to buy a home — England and Wales exchange and completion guidance.
- GOV.UK: Transferring ownership — legally binding exchange and completion.
- MoneyHelper: Contract exchange and completion — pre-exchange checks.
- mygov.scot: Making an offer and missives — Scotland’s binding-contract stage.
Sources checked 23 October 2026. This guide provides general information about buying with a mortgage, not a legal opinion, mortgage offer or promise of approval. Contract terms, lender requirements and costs depend on the transaction. Confirm the current position with your mortgage adviser and conveyancer before acting.