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Property Blog and News / Exchange of contracts and completion: a step-by-step guide

Exchange of contracts and completion: a step-by-step guide

Once you have had an offer on a property accepted, there are a series of steps the buyer and the seller must complete before the new home is yours.

There are no guarantees until the contracts have been exchanged and even then you may have to wait a few weeks before the seller will be able to hand the keys over. Exactly how long the process takes from beginning to end can vary but if the standard two weeks between exchange of contracts and completion is not long enough to arrange the move you can always ask for more time. Here is our step-by-step guide to what happens next after your offer is accepted.

1. Pay your deposit

The buyer pays a deposit to their solicitor or conveyancer. It is usually about 5% of the total agreed price of the house but it can be up to 10%. If the buyer pulls out after this stage they will lose this deposit and may face legal action from the seller. This is also the point where the buyer will also pay any other costs due to their solicitor, such as  Stamp Duty . Make sure you check the details of your solicitor’s bank carefully before making any payments.

2. Sign and then exchange contracts

The buyer’s solicitor will provide a series of legal documents to sign, including identical contracts which will be signed by both the buyer and the solicitor. These will then be sent by recorded delivery to each other’s solicitor or conveyancer. At this point, the deal is legally binding and no one can back out.

3. Make sure you are covered

At this stage, protect yourself with  buildings insurance cover  and consider  life insurance  too. There are big sums of money involved in buying a house and it is essential to prepare for any unexpected events.

4. A date for completion is set

Completion is when the money changes hands and you are able to finally get hold of the keys to your new place. A time of two weeks is usually allocated between exchanging contracts and completion, although it can be even quicker than this. The buyer’s solicitor can be sued if they fail to meet the deadline. Use this time to plan your move, pack your belongings and book a removals company if necessary. Make a list of all the people who need to know about your change of address, including utilities companies. If you think you need longer to prepare you can ask your solicitor to arrange this.

5. The lender releases the money

When the lender has received a Certificate of Title from the buyer’s solicitor, they will release the money to them. The  Certificate of Title  contains detailed information of the history of ownership of the property, and a complete legal description of it.

6. Final checks are made

Right before the lender releases the money, they’ll do a final check to make sure your circumstances haven’t changed. It’s a good idea not to do anything which might affect your credit rating around this time, such as maxing out any credit cards or making any large purchases.

7. The seller receives the money

Once the buyer’s solicitor receives money from the lender, they will forward it on to the seller’s solicitor. The sale is complete once the seller has received the money.

8. Time to pick up the keys

With the sale complete, there is now only one thing left to do – pick up the keys to your new home and move in.

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Home / Conveyancing / Exchange & completion demystified

Simple guide: Exchange & Completion Explained

Everything you need to know....

2023 update

Page highlights

• Tips that make moving home significantly less stressful
• How to influence the speed of your sale or purchase
• How to stay on top of your conveyancer

"TheAdvisory drips in honest-to-goodness practical advice for todays house sellers"

Table of Contents

‘exchanging contracts’ explained in under 9 seconds, ‘completion’ explained in under 7 seconds, agreeing your completion date, the buyer's deposit on exchange explained, can you do building work between exchange & completion, can i exchange and complete on the same day, pros & cons of attended exchange of contracts, can you pull out after contracts exchange, how to speed up exchange & completion, what should the estate agent being doing during all this, buyers: what needs to happen before i can exchange, sellers: what needs to happen before i can exchange, how do solicitors & licensed conveyancers exchange contracts, what happens between exchange and completion, how long between exchange and completion, what happens on completion day, what happens after completion, how can i make completion day less stressful, understanding the buyer’s completion statement, completion day checklists, common questions, related guides.

Exchange of contracts is the point at which a property transaction becomes legally binding. Both parties are contractually bound to finalise the sale/purchase on the agreed completion date.

What is exchange?

At exchange:

• Both parties’ solicitors are in possession of a signed contract
• The seller’s solicitor also holds the signed transfer of title deed (TR1 form)
• The buyer’s solicitor is in possession of cleared deposit funds, a mortgage offer and buildings insurance policy, if required
• A completion date has been agreed
• At the point at which the solicitors confirm with each other they hold all the legal documents required for the transaction to complete, they ‘exchange’ contracts (usually over the telephone) the transaction becomes legally binding.

What happens at exchange of contracts?

• Years ago, solicitors used to meet and physically exchange contracts, however that practice has been replaced by a verbal agreement over the telephone.
• On the day of exchange, the legal company at the bottom of the chain has to contact the next legal company up and confirm to them that they’re in receipt of a signed contract of sale and deposit funds and also confirm the terms of the sale and completion date.
• They will give the next solicitor or conveyancer up the chain a ‘release’ time to come back to them to confirm the exchange, this may be 4pm or 5pm that same day.
• The next conveyancer has to contact their client’s seller’s solicitor or conveyancer in the same way, until the one at the top of the chain has been reached.
• The exchange then needs to be confirmed back ‘down’ the chain, to reach the first legal company within the release timeframe.
• If that doesn’t happen, the exchange process will have to be re-started the next day.

What is the significance of exchanging contracts?

• The significance of this stage of the property sale/purchase is that it marks the point at which both parties are legally bound to complete the transaction.
• It sets the completion date and confirms all the legal paperwork is either already in place for completion or is guaranteed to be in place before then.
• If either party were to pull out after exchange, there would be penalties.

Completion is when a property transaction is legally finalised and the new owners get the keys. It takes place on a date specified at exchange of contracts.

What is completion?

• Completion is the final stage of the property sale/purchase transaction
• It takes place when the seller’s solicitor confirms they are in receipt of the full purchase monies
• Ownership is transferred from the seller to the buyer by the dating and transfer of title documents
• Vacant possession is given to the buyer by 1pm, unless otherwise agreed
• Sellers should have left the property by 1pm on completion day
• The buyer is given the keys, usually by the selling agent, and is free to move in.

What happens on completion?

• When the seller’s solicitor or conveyancer receives the full purchase funds, they will confirm to their client, the buyer’s legal representative and the selling agent that the sale has completed.
• The seller is normally bound to give vacant possession by 1pm, so they will generally have moved out on the morning of completion day.
• The buyer is free to collect the keys (usually from the selling agent) and move in.
• Once the sale has completed, the buyer is liable to pay any Stamp Duty Land Tax due to HMRC (usually handled by their solicitor, on their behalf).
• Their conveyancer will also register the buyer’s ownership with the Land Registry. However, it is the buyers responsibility to make sure the money is paid and ownership registered.

What is the significance of completion?

Completion signifies that ownership of and responsibility for the property has transferred from the seller to the buyer.

Given that the transaction is not legally binding until exchange has taken place, there is generally anything from two to four weeks between exchange and completion, to allow all parties to make moving arrangements.

These include:

• Removals – a deposit is often required by the removals company before a date can be confirmed
• Arranging for transfer of services, such as broadband and satellite television
• Informing providers, friends and family of change of address and arranging for mail redirection with Royal Mail
• Booking time off work.

The more parties in the chain, the more time it is likely to take to find a completion date that suits everyone, so be prepared to compromise and accept you might not be able to agree on your first choice.

Because most people have a full-time job, completions tend to take place on a Friday to give everyone the weekend to get the initial moving in and unpacking done, without having to take more than an afternoon or a day off work.

As such, it’s often the busiest day for removals companies, so once you have an idea of when you’re likely to complete, it’s a good idea to make a tentative booking.

Most removals companies will be happy to ‘pencil in’ a date, although they are unlikely to guarantee it until you pay the deposit.

Can you avoid Friday?

If you are able to agree to complete on a day other than Friday, the transaction is likely to complete earlier in the day, because mortgage companies and solicitors aren’t as busy, and you may be able to get a better price for your removals, so it’s worth making enquiries early on.

In addition, moving on another day allows for:

• More time to settle into your new home, a weekend is unlikely to be enough
• If there is a delay, your property can be stored overnight as opposed to over a whole weekend
• Problems with bank transfers or long chains can mean just 24 hour delays rather than taking up a whole weekend

The deposit that the buyer is required to pay on exchange is different to the ‘deposit’ required by a mortgage lender.

For the purposes of the legal agreement, the deposit on exchange varies from 5-10% or more of the purchase price, which must be lodged with the buyer’s conveyancer as cleared funds, i.e. via bank transfer, a cashier’s cheque or money order, or a cheque that has been cleared by the bank.

As a buyer, if you can ensure your funds are sent over to your solicitor or conveyancer several days in advance of the proposed exchange date, it should help move things along smoothly.

Deposits in a chain

If there is a chain, it is usual that a seller may be using the funds they receive from their buyer to pay for some, if not all of their onward purchase.

As such, the deposit lodged by the buyer at the bottom of the chain may be taken into account and passed up the chain.

For example, if the person at the bottom of the chain ( Buyer A ) is buying for £150,000 and their seller ( Buyer B ) is buying for £250,000, the £15,000 deposit lodged by Buyer A can be put towards Buyer B’s deposit, so they will only need to lodge £10,000 with their conveyancer, rather than the full £25,000.

If Buyer C is downsizing and only buying at £200,000, they won’t need to lodge any deposit, as it is covered by the funds already in the chain.

Peace of mind for sellers

As a seller, the buyer’s deposit funds give you peace of mind that they fully intend to proceed to completion and, if they don’t, you will be entitled to keep the full deposit as compensation.

You cannot, however, access the deposit funds until the transaction has completed.

The only exception would be if you required the deposit to be paid to an onward purchase of a new build, where the developer requires the deposit, in which case, the funds would be paid to them and guaranteed by a New Build Guarantee Scheme (such as NHBC ).

Yes you can, via a side legal agreement called a ‘key undertaking’.

It’s most commonly used when a property is currently vacant and requires refurbishment or modernisation , in order that the buyers are able to get it up to a standard where they can move in on completion.

The other instance where a key undertaking is employed is if the buyer’s mortgage lender has placed retention on the mortgage funds (i.e. is holding an amount back) until certain remedial works are carried out on the property, and the seller is not willing or able to carry them out themselves.

In this case, granting the buyer access to undertake the required works may be the only way for the sale to proceed.

If the seller agrees to allow access (which they may not) the key undertaking document will need to detail the exact nature of the works you intend to carry out and what will happen if you don’t complete the purchase for any reason.

Key undertakings also often stipulate that the buyer is responsible for the utilities and Council Tax from the date of exchange.

• It is certainly possible to exchange and complete on the same day, although it does make the transaction more stressful as a lot has to be organised with no guarantee that the sale/purchase will go ahead.
• A same day (or simultaneous) exchange and completion is most common where there is a cash buyer , no chain and both parties are looking for a quick transaction.
• If a mortgage is required, it may not be possible, as some lenders require a minimum period between exchange and completion, typically five working days.
• The downside of planning to exchange and complete on the same day is that there are a number of things that can hold up exchange – such as signed paperwork not being received in time, searches being delayed , a title issue, last-minute mortgage issues – so you risk losing out and running into problems if you have committed to removals, arranged for mail to be redirected, etc.
• Essentially, unless there is a very good reason for pushing through a speedy purchase/sale, it is much better to leaving at least a couple of weeks between exchange and completion, so that nobody is making commitments they may not be able to fulfil.

An attended exchange of contracts is where the buyer and seller meet in person, together with their legal representatives, to come to an agreement on the terms of the sale/purchase and push through exchange as soon as possible, ideally on the same day.

It tends to mainly be developers and property traders that look to carry out the transaction in this way.

It’s used when one or both parties want to push through the transaction as quickly as possible.

The buyer may want to own and start developing what they see as an excellent acquisition before anyone else gets hold of it, or the seller might have a pressing need to release their equity as soon as possible.

When to consider it

When a property is highly desirable and of great interest to a number of parties, if a buyer is able to push through a quick purchase in this way, that may give them an advantage and allow them to secure the property.

From a seller’s perspective, a quick sale will allow them to access capital that they may have an immediate need for – either to complete another purchase or to satisfy some other financial commitment.

It is typically only possible to reach exchange in this way if you’re a cash buyer, as most mortgage lenders will require more time to have searches, a mortgage valuation and possibly a home buyer’s survey carried out and paid for by the buyer, not to mention the time they take to prepare and issue a mortgage offer.

How it’s done

• All parties meet face to face, usually at the seller’s solicitor’s offices.
• If either the buyer or seller is unavailable in person, they will be contactable on the phone.
• Exchange is usually achieved the same day.

Pros & cons

The main thing to be aware of is that all the risk is placed on the buyer, so it is not for someone who’s inexperienced.

Generally, it is only well-capitalised, professional property investors who attempt attended exchanges.

• The seller has a buyer who is clearly committed
• The buyer eliminates the risk of being gazumped
• Negotiation is more straightforward because everyone is in the same room
• Given that both parties are keen to move quickly, they are likely to resolve any issues more quickly and less likely to worry about smaller, superficial problems
• The seller may be looking to push through a quick sale because they know of some big structural, title or planning issue, and the buyer has no time to check these things out as thoroughly as they should
• Because there is no time to carry out searches or have a proper survey, the buyer is reliant on the seller ad their solicitor giving fair and reliable information about the property
• It is much more expensive than standard conveyancing, because you have to pay for an experienced conveyancing solicitor’s undivided attention
• The buyer’s legal representative has the disadvantage of being away from their office and normal resources

The first thing to say is that either party pulling out after exchange is extremely rare.

At the point of exchange, both the buyer and seller are contractually committed to completing, so pulling out is a breach of contract and attracts financial penalties.

Advice for buyers

• As a buyer, you have the most to lose by pulling out, because you will forfeit your entire deposit and may be liable to pay interest on the balance of completion funds.
• As such, you should never proceed to exchange if you have any doubt about completing the purchase.

Advice for sellers

• As a seller, if you pull out, you are liable for the costs incurred by the buyer in the transaction to date, which is usually their conveyancing solicitor’s fees and the survey fee.
• It is not as financially punitive as it is for the buyer, but you should be aware that estate agents will be wary about dealing with you in the future because they don’t get paid for failed transactions.
• However, it may be that due to unforeseen circumstances you have no choice, such as an unexpected divorce, death or discovery of a required job move.
• In these cases it is worth seeing if it is possible to negotiate and that the seller/buyer will be sympathetic to your circumstances.

The key to moving the transaction along as quickly as possible is for all parties to respond to requests for information or action right away.

If buyers or sellers are unclear about the process or slow to respond, or solicitors and conveyancers don’t process things as quickly as they could, transactions can drag on for really no good reason.

There should be good communication between the buyer, their legal representative and their mortgage broker; similarly, the seller should be in touch with their conveyancer and estate agent to make sure things are moving along and there are no problems.

The estate agent should be in touch with all parties, checking in to progress the sale on a regular basis.

It also helps if you can agree an exchange and completion date to aim for right from the start, to give everyone a timescale to work towards.

This can help to uncover issues such as holidays which can delay progress.

Tips for buyers

• Have your conveyancer’s details ready to give the agent when making an offer.
• Make sure you understand the process – your solicitor or conveyancer should have a simple document outlining what happens when – then you know what you might need to chase up.
• Provide your conveyancer with everything they need as soon as they ask for it and make sure your initial cheque to cover searches. is lodged with them early – and that they apply for the searches as soon as they have your funds.
• Choose a recommended mortgage broker who is experienced at expediting mortgage offers
• Instruct an independent survey to be carried out as soon as possible.
• Ensure your deposit funds are easily accessible and with your solicitor or conveyancer as soon as exchange is on the horizon.
• Organise buildings insurance for the date of exchange so you can give the policy details to your legal company.
• Don’t go on holiday.
• Choose your conveyancer based on quality of services (not just price).

Tips for sellers

• Prior to your property coming to market, start putting together all receipts and warranties for work you’ve carried out and any formal documentation relating to home improvements, such as building regulations and gas and electrical certification.
• Instruct a solicitor or conveyancer before you’ve even had an offer, so they can contact your mortgage lender for the title deeds and start preparing the sale contract, ready to send out as soon as you secure a buyer.
• Understanding the conveyancing process will reduce stress and enable you to be more proactive.
• Complete property information and fixtures & fitting forms as soon as you receive them.
• Respond to additional enquiries by return.
• Sign and return the contract and deed of transfer in good time.
• See: Step by step guide to selling your home
• The estate agent should be progressing the sale, i.e. liaising with all parties to make sure each stage of the transaction is happening, as it should be.
• Because the buyer and seller can’t speak to each other’s conveyancer, it’s important for the estate agent to be able to keep them updated and reassured.
• Many estate agents now have dedicated sales progression teams, who spend all their time helping move transactions along and keeping clients informed.
• Some use software that allows buyers and sellers to log on and see exactly where they are in the process and what might be causing delays.
• Estate agents are often well placed to negotiate if any problems arise, such as adverse surveys that require a renegotiation of the price.
• Estate agents play an important role in reassuring both parties if things seem to be taking longer than expected.
• See: Using estate agents – everything you need to know

A good ‘no sale, no fee’ estate agent – one who’s experienced, knowledgeable and proactive – can really help achieve a smooth sale and purchase and it’s in their own interest, as they don’t get paid unless the transaction completes!

Getting ready to exchange contracts is a matter of getting the right legal and financial documentation signed and funds being in the right hands.

As a buyer, you must make sure:

• Your deposit funds (usually 5-10%; your solicitor or conveyancer will advise you of the amount required) must be cleared with your legal company.
• You have signed the contract of sale.
• You have signed the deed of transfer of title (although this is not strictly legally necessary, as long as the seller has signed it).
• You have arranged Buildings Insurance for the property.
• You have agreed a completion date.

Your conveyancer must:

• Be in possession of a signed contract and deed of transfer (if applicable).
• Have search results and any irregularities/concerns should have been addressed/resolved.
• Be in possession of your cleared deposit funds.
• Have a copy of your survey to check if there are any other queries which need to be addressed.
• Be in possession of your mortgage lender’s offer and have confirmed with the lender that they are able to provide the funds in time for completion.
• Have a copy of your Buildings Insurance policy, effective from exchange.
• Prepare a completion statement, detailing all the monies you have to pay.
• Have all paperwork relating to the lease and management of the building (if buying Leasehold).

As the onus is more on the buyer than the seller in the transaction, there is not as much for you to do.

As a seller you must:

• Ensure you have responded to all enquiries and provided all required documentation (warranties, guarantees, certification of works etc.).
• Ensure you have signed the contract and transfer of title document.
• Agree the completion date.
• Be in possession of your signed contract and signed transfer of title document.
• Be sure the deposit has at least been lodged with the buyers legal company ready for transfer.
• Have an estimate of any mortgage redemption costs, especially any early redemption charges you may have to pay.

In the past, solicitors would meet up in person to physically exchange contracts, however, these days it is done over the telephone.

They verbally confirm and agree the terms of the contract, the completion date and that they hold the required documentation and funds.

Once each solicitor in the chain has, in turn, agreed all this with the corresponding buyer’s/seller’s solicitor, contracts are said to have been exchanged.

What is the process?

• On the day of exchange, the solicitor or conveyancer at the bottom of the chain has to contact the next one up and confirm to them that they’re in receipt of a signed contract of sale and deposit funds and also confirm the terms of the sale and completion date.
• They will give the next legal representative up the chain a ‘release’ time to come back to them to confirm the exchange, for example this may be 4pm or 5pm that same day.
• The next solicitor or conveyancer has to contact their client’s seller’s legal company in the same way, until the solicitor at the top of the chain has been reached.
• The exchange then needs to be confirmed back ‘down’ the chain, to reach the first legal company within the release timeframe. If that doesn’t happen, the exchange process will have to be re-started the next day.
• See: Buying and selling a home at the same time and coping with being in a chain

How long does it take to exchange contracts on the day?

• It depends on how many people are in the chain and therefore how many solicitors need to be contacted in turn.
• If there is only one buyer and seller, exchange can happen as quickly as they can make and receive a call.
• If, however, there are several people in the chain and three or four legal companies and mortgage lenders involved, it can take all day, because one solicitor or conveyancer might not be available when another calls.
• What is important to think through in advance is how long you need between exchange and completion.
• For example, if you have lived in a home for the average 21 or more years you may need a month or more to be able to downsize your contents or put them into storage prior to moving.
• If you don’t have too much to move, you may not need the ‘standard’ two weeks legal companies tend to suggest.

Why might exchange not happen on the day it’s supposed to?

Often this is down to a conveyancer being unavailable to take or make the required phone calls, either because they’re out of the office or in a meeting.

Regardless of the reason, it does suggest the solicitor or client may not be acting in the best interest of their client and it’s very frustrating for all parties.

Other reasons maybe required paperwork which was promised and not received, such as offers from lenders or it could be deposits being promised but not being transferred by buyers in time.

Other key reasons include buyers and/or sellers going on holiday or being away with work and not leaving the appropriate instructions with their legal company.

Bear in mind that most legal companies work on cases which they have to complete legally that week first, then, if time, look at property transactions which are expected to exchange and then progress other cases.

As a result they may intend to exchange on a certain date but when they look at the file, perhaps on the one day or morning they have spare, they realise they are missing key information required.

This is particularly the case if they are not a proactive legal company or overload the legal department with too many cases.

Make sure you pick a conveyancing firm that is proactive, has the most up to date technology and is keen to achieve exchange and completion dates you set rather than ones that suit them.

Once exchange has taken place and all parties are legally obliged to complete, everyone can make their arrangements for the agreed completion day.

Who does what?

• Confirms removals and starts packing.
• Plans move (change of address, mail redirection, etc.).
• Contacts utilities and services to inform them of impending transfer or end of service.

Buyer’s conveyancer:

• Ensures mortgage company is on track to transfer monies on completion.
• Draws up final completion statement.
• Ensures everything they agreed to include in the purchase is left in place.
• Set up mail redirection to take effect from completion date.
• Leaves a set of keys with the estate agent, to be handed to the buyer on completion.

Seller’s conveyancer:

• Confirms redemption amount with mortgage lender.
• Draws up completion statement.

The length of time between exchange and completion is whatever all the parties involved agree to, but it’s usually one or two weeks.

That gives everyone time to organise themselves for completion:

• Buyers and sellers can confirm removals and start packing.
• All parties can arrange for the transfer of services and utilities and redirection of mail.
• There is time to draw down any mortgages required.

It’s not always 14 days

• Sometimes exchange and completion take place on the same day and sometimes there can be a gap of one or two months (or even longer).
• A longer gap is most often seen in cases where someone is currently in rented accommodation and needs to give two months’ notice, which they wouldn’t be advised to do until exchange has taken place.
• If you’re buying a new build, there may be a much longer delay, as the property may not have been built at the point you exchange.
• A delayed completion date may also be agreed if the sellers of a property you’re buying have not yet secured an onward purchase.
• The one thing to be aware of is the expiration of mortgage offers, which are usually valid for three to six months.
• So if you received your mortgage offer early in the process and it took several months to get to exchange, your completion deadline might be dictated by your mortgage lender, otherwise you will have to reapply, which is likely to delay the process for everyone.
• On completion day, the purchase monies (comprising the buyer’s own funds and any required mortgage) are transferred to the seller’s solicitor, at which point the transaction is completed.
• The seller is usually obliged to vacate the property by 1pm on the day and ownership transfers to the buyer.

What can cause delays on completion day?

The main cause of delay is usually the transfer of monies. If a mortgage is involved, the funds have to be sent by the lender to the buyer’s solicitor or conveyancer, who must then pass them straight on to the seller’s legal company.

Provided the lender makes the transfer first thing in the morning and the buyer’s solicitor or conveyancer attends to the onward transfer right away, completion can usually take place by 12 noon.

However, if the seller’s legal representative has not received the funds by 3pm, completion may not happen until the following day – although this is very rare.

The other thing that can hamper the process is if a party in the chain has miscalculated the monies required to complete, which includes stamp duty and any agents’ fees plus VAT .

Last-minute transfers can mean the transaction doesn’t complete until later in the day.

From a logistical perspective, people not starting the removals process in good time can cause delays.

Sometimes the transaction has completed but a buyer is unable to move into their new home because the seller has not yet vacated it.

In this case, if costs are incurred, such as additional removals charges or there is the need for overnight accommodation, the seller can be pursued for costs.

These are good reasons why it is worth aiming for completion earlier in the week so there is still time to complete prior to the weekend, rather than relying on everything going well on a Friday.

What happens if completion doesn’t take place?

If either party fails to complete on the contractually agreed date, they are in breach of contract and there are penalties.

Buyer fails to complete:

• They will be served with a notice to complete within ten working days (2 weeks) before contracts are rescinded.
• They are liable to pay interest to the seller on the amount of the purchase monies not sent through – normally calculated at 4% above the Bank of England Base Rate .
• If they do not complete within two weeks, the seller rescinds their contract and the buyer forfeits their deposit.
• The seller can resell their property to someone else and may pursue the buyer for losses incurred if they cannot achieve the same sale price.

Seller fails to complete:

• The buyer can rescind their contract, if it has not already been withdrawn by the seller.
• The seller must return the buyer’s deposit.
• The seller is liable for the buyer’s costs, such as legal, mortgage and survey fees.

For the seller and buyer, completion is mainly about physically moving house.

However, for their legal representatives, there are some key transactions that still need to be processed.

• Collects the keys from the selling agent and begins to move in.
• Checks that all fixtures and fittings are present as agreed in the contract of sale and informs agent and/or solicitor if anything is out of order.
• Changes the locks.
• Notifies utility companies of new ownership & takes meter readings.
• Informs contacts of change of address.

Buyer’s solicitor

• Transfers deposit to seller’s solicitor.
• Registers title deed of ownership with the Land Registry.
• Submit Stamp Duty Land Tax Return.
• Pays Stamp Duty Land Tax due to HMRC.
• Sends buyer the Title Information Document, a summary of information the Land Registry holds and an SDLT5 certificate as evidence that the Stamp Duty has been paid.
• Takes final meter readings.
• Vacates property (although they usually move out first thing in the morning, ready for completion).
• Hands a set of keys to estate agent, if not done so already.

Seller’s solicitor

• Redeems any mortgage on the property.
• Pays estate agent’s bill.
• Settles their own bill.
• Pays remaining balance over to seller.

The key to your completion day running smoothly is effective planning.

• Put together a list of everything you need to do early in the process and start making arrangements as soon as you know exchange is on the horizon.
• As Friday is the most popular day for completions, consider doing it on another day when legal companies, mortgage lenders and removals companies aren’t so busy.
• Give yourself and your removals company plenty of time to pack and consider paying for a night of storage so you’re not rushing to get everything out of the property on the morning of completion.
• Set aside all your most valuable possessions – anything you want to keep with you on moving day, rather than leave to the removals company. Get these together early, so you don’t overlook anything and panic on the day.
• Keep a folder of all your important legal, financial and personal paperwork and make sure you’ve always got access to it, in case your solicitor or conveyancer, mortgage broker or insurance company need any information from you.
• Check your belongings are properly insured for removals, via your own contents insurance and/or by the removals company’s insurance.
• Speak to the estate agent a few days before to make arrangements for collecting the keys. Some agents will offer to meet you at your new property, which can be a big help if going to their office would mean a big detour for you.
• If you have pets and/or young children, it might be a good idea to have them stay with friends or family on the day.
• Have a ‘Plan B’ with alternative accommodation in reserve, just in case anything goes wrong and you can’t move in that day.

The buyer will get a completion statement from their solicitor on exchange, detailing exactly what monies have been paid, are due to be paid and what is required to complete. It includes:

(A) The total amount you will pay the seller on completion

• The purchase price
• Any additional payment that might have been agreed for fittings

(B) Fees, taxes and charges

• Stamp Duty Land Tax – paid on your behalf by your solicitor within 30 days of completion. You must pay this amount to your solicitor before you can complete if they don’t have enough funds.
• Land registration fee, paid to the Land Registry to update ownership records for the property. Again, this must be paid to your solicitor prior to completion.
• Property search fee – this includes local authority, drainage and environmental searches, the title plan and the chancel indemnity insurance. You will have paid for these up front after you instructed your solicitor.
• Fees for Identity and pre-completion checks.
• Legal company’s fee, including VAT.

(C) Monies already paid/received by the legal company

• Deposit paid when you instructed your solicitor or conveyancer.
• Property searches, paid shortly after instructing your legal company.
• 5-10% deposit, paid on exchange of contracts, or the deposit amount agreed.
• Mortgage advance (to be drawn down prior to completion).

Before completion can take place you have to pay the balance to your conveyancer ->  (A + B) – C = Balance Payable

Buyer checklist

• Await phone call from either your legal company or the selling agent confirming completion
• Collect keys.
• Arrange to be at your new home at 1pm, by which time the seller should have vacated.
• Make sure everything agreed in the fixtures and fittings list has been left in the property
• Read utilities meters.
• Connect services.
• Inform contacts, suppliers, providers and membership associations of new address.

Seller checklist

• Make sure you’re leaving everything as agreed in the fixtures and fittings form.
• Leave light bulbs and make sure there are no bare wires.
• Take meter readings.
• Vacate by 1pm.
• Ensure keys are with estate agent.
• Contact local authority to inform them you no longer own the property.
• Cancel direct debits for mortgage and buildings insurance on the property.

What is the difference between exchange of contracts and completion?

Exchange of contracts is the point at which the buyer pays a deposit and the sale/purchase contract becomes legally binding.

Completion is when the balance of the payment for the property is passed over to the seller’s solicitor and ownership transfers to the buyer.

What is the date of completion?

The date of completion is one that is agreed by both parties prior to exchange, commonly one or two weeks later. It is the date on which full payment is made to the seller, ownership transfers to the buyer and moving day takes place.

How much time is REALLY needed between exchange and completion?

Legally, exchange and completion can take place on the same day.

However, if a mortgage is required for the purchase, the lender might require five working days between the two and it is much less stressful for all parties if there is a period of time after the transaction becomes legally binding, to give everyone time to make moving arrangements.

If you are trading down, think about how long it will take you to downsize your contents.

It may take weeks or even months, so if you need more time between exchange and completion, do make sure you secure this early on in the process.

What does completion mean when you are buying a house?

When you’re buying a house, completion means you have paid the seller (commonly with a combination of your own money and mortgage funds from a lender) and ownership of the property has passed to you.

It is the day you can move in.

What does it mean when you exchange contracts on a house?

Exchanging contracts is the point at which the buyer and seller are both legally bound to complete the transaction.

The buyer lodges a deposit with their solicitor and if either party pulls out of the agreement, which is very rare, there are financial penalties.

Can you exchange contracts without a completion date?

No, both parties must agree a date, which is inserted into the contract before exchange can take place.

• What is conveyancing?
• Conveyancing process explained: For Sellers  
• Conveyancing process explained: For Buyers
• How much should conveyancing fees cost
• Should you do conveyancing yourself
• How to choose your conveyancing solicitor
• How to deal with conveyancing complaints & problems
• Conveyancing searches explained
• Step by step guide to extending your lease
• Stamp duty land tax (SDLT) explained

Gavin Brazg

MSc Dip Arch

Founder & CEO

Sources, citations & credits

• The Importance of a Properly Drafted Key Undertaking – Dominique Oliviero for Clough & Willis Solicitors
• Conveyancing Fees & Quotes
• How To Extend A Lease
• Conveyancing Process Explained (When Selling)
• Conveyancing Searches
• How To Make Complaints & Resolve Conveyancing Problems
• Conveyancing Process Explained (When Buying)
• Choosing Your Conveyancer
• DIY Conveyancing
• Stamp Duty Land Tax (SDLT)
• Want to avoid solicitors that rip you off, baffle you with jargon and make a mess of your move?

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Exchange Of Contracts: Your Complete Guide

If you’re buying or selling a property, you’ll need to know about exchange of contracts. here’s your essential guide.

Once you’ve had an offer accepted on a property, or you’ve accepted an offer on your home, the wait to get everything finalised can be a stressful experience.

The ‘exchange of contracts’ stage is a vital step into you getting your purchase or sale finalised. In this guide, we look at the exchange of contracts process and answer all your questions about how exchange of contracts works.

What is Exchange of Contracts?

Until the point that you exchange contracts, the housebuying process is not legally binding. Either a buyer or a seller can pull out of the process at any time.

At exchange of contracts, both the buyer and the seller of the property sign an official document to complete on the sale/purchase of the property. From this point on you are both legally committed to the purchase of the house.

The Exchange of Contracts process explained

Once a seller has accepted an offer on the property, there are several issues that a buyer should address. These may include arranging a mortgage , completing searches, and carrying out a survey on the property. Find out more about the conveyancing process .

What to do before you exchange contracts

The contract between you and the vendor of the property is signed when:

• your mortgage offer has been received and checked.
• the survey report is completed and any remedial action is taken/agreed.
• you and your solicitor have made arrangement for the payment of your deposit.
• your solicitor or conveyancer has completed all their enquiries/searches and they are satisfied with the outcome.

At this time, your solicitor prepares a final contract which the buyer and the seller both sign. These contracts are then exchanged and, from this point, both the buyer and the seller are legally bound by the contract and the sale of the house has to go ahead.

When to exchange contracts

If you’re buying a property, the unfortunate fact is that the purchase can fall through at any time if the vendor changes their mind. Similarly, you may leave the vendor in a difficult position if you pull out of the sale.

This uncertainty is the reason why both parties generally want to exchange contracts as quickly as possible. However, you should only exchange contracts once all the major issues have been addressed.

Yot can exchange contracts when:

• your mortgage offer has been received
• you have the deposit available
• the legal work has been completed
• all searches have been completed and have come back satisfactorily
• all parties in the chain are ready to proceed

How to exchange contracts

The exchange of contracts process is managed by your solicitor or licensed conveyancer. There is not much you have to do other than chasing up your solicitor to make sure everything is proceeding.

Your solicitor will draw up a contract which will include the purchase price and other issues such as whether certain fixtures and fittings are to be included or excluded. The contract will set out who the buyer and seller are, and it will also include a date for when the sale will complete and when the property will belong to the buyer.

Once all this has been agreed, your solicitor will call you in so you can go and sign the contract. The other party will also sign and then the contracts can be exchanged. From this point, both parties are legally bound to proceed with the transaction and the new owner of the property will also be added at the Land Registry .

Deposit on exchange of contracts

As a buyer, when you exchange contracts you typically pay a deposit of 10% of the purchase price to the seller. On occasion, this can be reduced to 5%.

The balance of the purchase price – often made up of your mortgage and your own savings – is paid on completion.

New build exchange of contracts deposit

If you are buying a brand-new property, the process is broadly the same except there is generally a longer period between exchange and completion. You may also have a time limit to exchange contracts (this is typically 28 days).

During the reservation period, your solicitor will undertake the necessary checks and searches so that you’re in a position to formally exchange contracts. When all parties are happy with the agreement you will sign the contract and pay the deposit, which is usually 10% of the purchase price.

The contracts can then be formally exchanged and you are legally bound to purchase the property.

Find out more about the new build buying process .

Insuring the property after exchange of contracts

The contract will generally state who has to arrange buildings insurance between exchange of contracts and completion.

The buyer will almost certainly be responsible for the buildings insurance for this period, which can be anything from a day to a few months depending on other buyers and sellers in the chain.

How long does it take between exchange and completion?

When you exchange contracts, a completion date is also confirmed. The completion date is the day you pick up the keys and can move into the property.

One this day, the buyer must hand over all the remaining money needed to buy the property.

When you exchange contracts, it is important that the date set for completion is achievable. The buyer needs to know that they will have the money available and the seller needs to be sure that they can vacate the property by this day.

On completion day:

• the mortgage lender releases the money to the solicitor so they can complete the purchase.
• the deeds to the property are handed over to your solicitor/conveyancer.
• the seller hands over the keys and vacates the property.

Exchange and completion on the same day

It is sometimes possible to exchange contracts and complete on the same day.

Experts warn that this can be risky as it requires all the money to be transferred on time. Similarly, it also leaves the buyer vulnerable to the seller making last-minute demands.

Pulling out after exchange of contracts

Once both parties have signed and exchanged contracts, it is very difficult for either party to back out of the agreement.

• Buyer – If you do not complete you will lose your deposit and you can be sued. The vendor may serve a notice on you requiring you to complete and pay the vendor’s additional legal costs. You may also have to pay interest on the unpaid purchase price. In some cases, if the seller subsequently sells the property for a lower amount, the buyer may be liable for the difference.
• Seller – If the seller fails to complete the buyer may rescind the contract. The deposit is returned to the buyer with interest and the vendor must pay to cancel any registration of the contract.

What happens if a buyer pulls out after exchange of contracts?

If a buyer pulls out after exchange of contracts, then the seller can rescind the contract and keep any deposit paid. They can also resell the property and claim damages.

There are reasons why a buyer may pull out of the transaction, such as:

• unexpected redundancy
• change of mind
• promised funds not arriving

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• Exchange of contracts explained

With the exchange of contracts you legally commit to buying the property. Exchanging contracts is exciting but can also be tricky. We take a look at how to exchange contracts, what you should expect and what to watch out for.

What is exchange of contracts?

Until you exchange contracts as part of the conveyancing process , neither side has any legal obligation to buy or sell the property, and both can pull out without any penalty (or only the deposit on agreeing offers, if one was made). Both buyer and seller sign identical contracts, but only when they are formally exchanged by the solicitors does the deal become legally binding.

Between exchange of contracts and completion, either side will almost certainly pay major penalties if they pull out. However, it is extremely rare for anyone to pull out after exchange of contracts, and in practical terms, this is when you can breathe a sigh of relief – once you exchange contracts, you can be pretty sure your house sale will go through.

How long does it take to exchange contracts?

It usually takes around 8 to 12 weeks to reach the point where you’re ready to exchange contracts.

When do I exchange contracts?

Exchanging contracts means you are legally committed to buying the property so you have to make sure you have everything in place beforehand so that nothing can go wrong. There are a range of things your conveyancing solicitor will do to ensure you are ready for the exchange of contracts.

The exchange of contracts can be done once:

• You have agreed on an offer, including for fixtures and fittings
• You have had the mortgage valuation and any surveys you want
• You have been formally offered a mortgage in writing
• You have arranged funding for the mortgage deposit
• Your conveyancing solicitor has done all relevant searches
• You have organised building insurance . After you exchange contracts, you are liable for the property, and so you need to have buildings insurance in place before hand
• You have sorted out funding for the contract deposit (traditionally 10% of the purchase price, but nowadays often less)
• You have agreed on a date of completion for the sale, which will be written into the contract
• You have read, understood and signed the contract

Once you have done these things you will agree on a date and time to exchange contracts.

What’s the average time between exchange and completion

The average time between exchange and completion is 7 days. Although the exchange of contracts can be on the day of completion (see below) and in many cases the period of time between exchange and completion is much longer.

What time of day does exchange of contracts happen?

Most exchanges happen before lunchtime, between 10am and midday. But this will depend on factors such as your conveyancer’s schedule as they will exchange contracts for you.

Get instant quotes from regulated and reviewed conveyancing solicitors that cover your area.

How long does it take from exchange to completion?

The average length of time from exchange to completion is typically one week. However, how long between exchange and completion can be any time agreed between all parties in the chain. And it can differ depending on the circumstances of the buyer or seller. Chain free or cash buyers may have a shorter time frame between exchange and completion. While those buying with a mortgage may need longer to complete.

Can you exchange and complete on the same day?

Yes, it is possible to exchange and complete on the same day. There are advantages to exchanging and completing on the same day, for example it speeds up the conveyancing process . Although it’s generally only an option if there is no chain and it’s easier if you’re a cash buyer so you don’t have to worry about transferring money from the mortgage lender.

If you are keen to exchange and complete on the same day, the things to consider are:

• Exchanging and completing on the same day can be very stressful; you won’t definitely know that you are moving until the day that you move which makes arranging a removals service and forwarding post more complex. You will need to have your house packed up with the removals firm ready, while you are waiting to hear that contracts are being exchanged.
• If anything does go wrong, you don’t have any time to put things right.
• Some mortgage lenders are happy with the exchange of contracts and completion on the same day, but others require a minimum period (such as five working days) between.
• You and the mortgage lender should transfer the funds to your solicitor the day before, to ensure there are no money transmission problems.
• You are making yourself more vulnerable to an unscrupulous seller demanding something extra at the last moment, as you will be all packed up and ready to go, and not really in a position to negotiate.

Need a conveyancing solicitor? Compare conveyancing quotes and appoint your legal team today

The risks of exchanging and completing on the same day are highlighted in the following interview given to BBC Radio 4’s You & Yours programme in July 2021, featuring our Chief Executive Paula Higgins.

What can hold up exchange of contracts?

The most common issue that can hold up exchange of contracts is with the buyer or seller, or their conveyancing solicitors, taking their time when responding to enquiries.

Other factors that can hold up exchange of contracts are:

• Building survey revealing problems. Read our guide A bad house survey report: What to do next .
• Problems with the property title
• Missing information from the seller
• Issues with the buyer’s  mortgage application
• A probate sale
• Delays in getting back local authority searches
• Being in a  chain
• Buying a new build property that isn’t ready (see below)

See our guide for more advice on what causes delays and how to speed up conveyancing .

How do I exchange contracts?

The exchange of contracts is usually done by both solicitors/conveyancers reading out the contracts over the phone (which is recorded) to make sure the contracts are identical, and then immediately sending them to one another in the post.

If you are in a chain, your solicitor/conveyancer will do the same thing, but will only release it if all the other people in the chain are happy to go ahead. This means if one person pulls out or delays, everything gets held up. Find out how to break the housing chain .

Once you have exchanged contracts you will be in a legally binding contract to buy the property. If you do not, you will lose your deposit and you can be sued. Equally though, the seller has to sell or you can keep their deposit and sue them.

What is the process for the exchange of contracts?

The exchange of contracts involves:

• Checking you’re ready to exchange: Have all your enquiries been satisfied, is your funding arranged, have you arranged building insurance?
• Signing the contract: When you’re ready to exchange, review and sign the contract
• Paying the deposit: When you must lodge your deposit with your conveyancer. This is usually 10% but you may agree less.
• Instructing your solicitor to exchange contracts: This is done by both solicitors reading the contracts over the phone then immediately posting them to one another.

Looking for a conveyancing solicitor? Compare conveyancing quotes from our panel of quality assured conveyancers :

What happens after exchange of contracts?

After exchange of contracts there are a number of things that need to happen before completion. These are:

• You and your estate agent should visit the property just before completion day to ensure that all the fixtures and fittings you agreed on are in place and that nothing has been damaged in the meantime.
• If you’re a buyer, you’ll need to make sure all the funds are in place for the completion of your house.
• Arrange your contents insurance for your new house. You should already have buildings insurance for your new property in place from exchange of contracts. Find out more in our guide on Insurance when moving house (read on for more on this).
• Sort out your broadband. Now your completion day is fixed you can book broadband for your new house. Read more in our guide on Broadband and moving house explained .
• Your conveyancer should notify the freeholder if you’re buying a leasehold property .
• Your conveyancer should register the transfer of ownership with the Land Registry
• Contact your bank, credit card company and any other companies you have accounts with of your new address and the date you’ll be moving.
• Organise post forwarding
• If you’ve already chosen your removals firm, contact them to confirm your moving date. If you haven’t got your removals company firmed up, get removals quotes as soon as possible.

To find out more about about the next step, read our guide What happens on completion day?

Home insurance and exchange of contracts

When you’re buying a house you should get buildings insurance in place from exchange of contracts because that’s when you become legally responsible for the property. Make sure to shop around and compare home insurance quotes to make sure you get the best deal.

However, if you’re buying a leasehold property , buildings insurance is often arranged by the freeholder. So check this before putting a policy in place. Find out more in our guide on Insurance when moving house .

Video: Conveyancing process explained

Related Reads

More related reads.

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• What happens on completion day?
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• What does a conveyancing solicitor do?
• How to speed up conveyancing
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• Conveyancing process explained for buyers
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• New build conveyancing explained
• Local Authority Searches: What are they? How long do they take?
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• Compare Conveyancing Quotes
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What happens between exchange and completion?

• Mortgage Conveyancing
• Steve Roberts
• February 13, 2023

Home » Mortgage Guides » Mortgage Conveyancing » What happens between exchange and completion?

When you are almost at the end of your house-buying journey, you will become familiar with two terms that are used by your estate agent and conveyancer: exchange and completion.

If you’re a first-time buyer , it might be that you don’t know what these terms mean. It might also be the case that you have moved house before but have forgotten what happens between the exchange and completion stages.

In this guide, we will tell you everything you need to know so keep reading if you’re interested in learning more.

A quick summary of ‘Exchange’

Exchange refers to the ‘exchange of contracts.’ At this point in the house-buying process, the property transaction becomes legally binding so you are contractually obliged to finalise the purchase or sale of the home on the scheduled completion date.

What is the exchange of contracts process?

Below we take a look at what happens both before and during the exchange of contracts.

Before exchange:

• A survey of the property is completed – Learn about property valuation surveys
• The buyer receives a mortgage offer from the mortgage lender
• The seller gathers up the paperwork for their home
• The buyer and seller sign the contracts needed for the transaction and send them back to their solicitors

At the exchange of contracts

• Each solicitor possesses a signed contract
• The buyer’s solicitor is in possession of the deposit, the mortgage offer, and the building insurance policy (if this has been required)
• The seller’s solicitor is in possession of the signed title deeds
• The buyer and seller agree on a completion date
• The timeframe of the house sale is confirmed across the property chain
• The buyer’s solicitor will call the seller’s solicitor and agree to the exchange of contracts
• In the case of a leasehold property, the freeholder will be given the new owner’s details

What is the significance of exchanging contracts?

The day when contracts have been exchanged is very significant because:

• The buyer and seller are legally bound to go ahead with the transaction
• The completion date is set
• The buyer pays monies owed to the seller
• Any party that backs out of the transaction after exchanging contracts will face financial penalties
• After the solicitors have exchanged contracts, the buyer and seller can organise their get respective house moves

A quick summary of ‘Completion’

Completion refers to the ‘completion date,’ the day when the property legally changes hands.

What is completion?

• Completion is the final phase of the property sale
• Property ownership transfers from the seller to the buyer

What happens on completion day?

• The purchase price of the property is paid, minus the deposit
• On receipt of funds, the seller’s solicitor will confirm to their client, buyer’s conveyancer, and estate agent that the sale has been confirmed
• The property is vacated by the seller at the agreed time
• The buyer collects the keys from the selling agent and moves into their new home
• The buyer becomes liable to pay Stamp Duty Land Tax to the HMRC
• The buyer’s conveyancer registers ownership of the property with the Land Registry

What is the significance of completion?

Completion day is very significant because this is the day when both the buyer and the seller begin the next chapter of their lives. The seller moves on to their next property and the buyer takes ownership of the property that has now been vacated.

Exchange to completion in 10 bite-sized steps

Discover the crucial steps that take place between exchange and completion of a property sale with our helpful infographic.

Agreeing on your completion date during the exchange of contracts

The completion date is usually four weeks after the exchange of contracts but this can be negotiated to suit the parties involved.

Before agreeing to a date, you need to:

• Check the prices and availability of local removal companies
• Talk to your employer about booking time off work
• Figure out which day of the week suits the members of your family

When you have agreed on a date with either the buyer or seller, you then need to:

• Book a removal company
• Contact your broadband suppliers and utility companies to let them know your moving date
• Organise buildings insurance
• Inform friends and family of your change of address
• Arrange to have your mail forwarded by Royal Mail
• Book time off work

Why do people complete on a Friday and can you choose another day?

Most buyers complete on a Friday as they have the weekend to unpack and organise their new home, so have little need to book an extra day off work.

But because Friday is so popular, you will need to make a tentative booking with a removal company when you have an inkling of when the completion date might be. Most companies are happy to pencil in a date although this will only be finalised when you have paid them a deposit.

Of course, you don’t have to choose a Friday. If you’re able to book a few days off work, you might want to move into your new property earlier in the week. This will give you more time to unpack your boxes and organise your new home. As mortgage lenders and removal companies are less busy on other weekdays, this is another reason to choose a different day.

Unfortunately, weekends are out of the question so don’t expect to move on a Saturday or Sunday. This is because both the buyer’s and seller’s solicitors need to be available on the completion date and they are unlikely to work at the weekend.

Another reason to avoid a weekend is bank transfers. They don’t go through on a weekend so a weekday is better if you want to avoid delays during the exchange and completion stages.

What happens to the buyer’s deposit on exchange of contracts?

When the buyer exchanges contracts with the seller, they need to pay an exchange deposit.

This deposit is usually between 5-10% of the property’s purchase price. –

Along with the legally binding contract, the deposit is a confirmation that the buyer is committed to the purchase of the property. Should they pull out of the deal after exchanging contracts, they could be sued by the seller and forced to award them compensation (which will include the deposit).

To ensure the transaction process goes smoothly, you should send deposit funds over to your solicitor several days before the exchange date. This can be done via a bank transfer, money order, cashier’s cheque, or cheque that has been cleared by your bank.

Deposits in a chain

The deposit sent by the buyer will usually be used by the seller to pay the costs associated with their next home. They might put the buyer’s deposit towards their own deposit, for example.

So, if Buyer A, at the bottom end of the property chain, was buying a house for £150,000, and they owed the seller (Buyer B) 10% deposit of the purchase price, they would send £15,000 to Buyer B via their solicitor.

On receipt of the deposit, Buyer B could put this money towards the deposit for their next property. If the property cost £250,000 and they needed a deposit of 10% , they would only need to pay £10,000 as the money sent to them by Buyer A could be used to pay the remainder.

Peace of mind for sellers

If you’re a seller, the deposit paid by the buyer can give you peace of mind that they are committed to buying your property. If they back out before the agreed completion date, you will be entitled to compensation, which will include the exchange of contract deposit they have already paid you.

Unfortunately, you aren’t able to access the deposit funds, until after the transaction has been completed. The only exception is if you are buying a new build property as the developer may require the contract deposit at an early stage. In this situation, the funds would be sent over to them and guaranteed by a New Build Guarantee Scheme.

What happens if my deposit is in an individual savings account (ISA)?

There are many ISA’s but the two main ISAs for buying a property are the help to buy ISA and the Lifetime ISA (LISA) .

Help-to-buy ISA

A Help-To-Buy ISA can be used to buy a home worth up to £250,000 (or up to £450,000 if buying a property in London). Although many people have an active Help To Buy ISA (Help To Buy Equity Loan Scheme), the government have now closed to any new applicants.

If you already opened a Help to Buy ISA before the cut-off on 30th November 2019, then congratulations – you have until 2029 to continue saving and receive your 25% government bonus by 2030! Don’t miss out on this opportunity to get more bang for your buck.

The money can be used towards the exchange deposit but you will need to request a closing statement from your ISA provider before you can withdraw your saved funds.

You then pass the closing statement to your solicitor, who will claim your 25% bonus from the government. This bonus can be put towards the deposit.

Lifetime ISA (LISA)

The next best ISA for saving to buy a property in the UK is the Lifetime ISA (LISA). This type of individual savings account became available in April 2017 and is engineered to help people save up for the long-term goals of home ownership or retirement. LISAs have proved invaluable resources for many savers since their emergence; don’t miss out on this opportunity!

With a LISA, the government will happily provide an astonishing 25% bonus to your savings every year – this is up to a maximum of £1,000 and completely tax-free! And it doesn’t stop there; you get all these rewards until you reach age 50.

Am I eligible?

If you’re between the ages of 18 and 39, you are eligible for a LISA. Contributions can only be made until age 50; however, after that point, your money can be used to buy your first home (up to £450,000) or taken out at 60 with no penalties imposed. If withdrawal occurs before reaching 60 years old though, 25% will be deducted from the total amount removed.

The lifetime ISA is an excellent choice for those hoping to save up for a first home or retirement and are willing to commit their funds long-term. This option has been proven advantageous time and again due to its attractive savings rate.

What your solicitor must send the ISA manager

If you are looking to access funds from your Lifetime ISA for a purchase, make sure that you supply the necessary information to the associated manager:

• a declaration that they’re an eligible conveyancer
• a declaration that they have received the information from the LISA holder and that they have no basis to doubt its accuracy and integrity.
• the purchase price of the property
• a declaration to only disburse the amount withdrawn towards fulfilling the cost of purchasing the property.
• details of your LISA account which will be receiving the withdrawn funds
• the solicitor’s unique professional body registration number
• a declaration that having carefully examined the facts and figures, they hereby attest that all of the information provided is accurate and complete to their best knowledge.

Each LISA manager or bank will have their own declination example. Below is a declaration example with text that must be used.

What the bank or ISA manager should do

The ISA Manager is required to transfer funds of the specified amount within 30 days of receiving your declaration.

The charge-free withdrawal will not be approved if:

• The ISA manager has sufficient grounds to assume that the information you provided is inaccurate or incomplete.
• If the first payment to that account is within 12 months of the withdrawal

When the purchase is complete

Within 10 business days of purchasing, your solicitor must inform the ISA Manager via email or post about:

• the completion date of the purchase
• The account number associated with the Lifetime ISA from whence the withdrawal transpired.
• their personalised conveyancer reference number should be registered with the relevant professional organisation.

Read more information on what to do if the purchase failed or isn’t completed within 90 days.

Can you do building work between exchange and completion?

If you need to carry out building work on your new property between the exchange and completion stages, your conveyancing solicitor can request access via a legal document known as a ‘Key Undertaking.’

You should specify what type of work you need to be carried out in a draft. Once this has been agreed upon, you sign the document and make it legally binding. If you breach the terms of the agreement, i.e. by carrying out unauthorised work on the property, you may be sued by the seller.

Can I exchange and complete on the same day?

Yes, it’s certainly possible to exchange and complete on the same day, although most mortgage lenders won’t allow this.

Exchange and completion on the same day usually occur in situations where there is a cash buyer, no chain involved, and the buyer and seller want to make a quick transaction.

In all other instances, it’s quite rare that exchange and completion happen on the same day. This is because:

• Most mortgage lenders require a minimum period (usually five working days) before exchange and completion as it can take a minimum of 48 hrs for the mortgage funds to be drawn down.
• The transaction can become stressful as a lot of work is required for everything to happen on a single day
• A lot can go wrong, such as a delayed transfer of mortgage funds or the risk of signed paperwork not being received on time

As such, it’s better to leave a few days’ gap between exchange and completion to alleviate the stress of everybody involved and to minimise the risk of anything going wrong.

Pros & cons of attending the exchange of contracts

An ‘attended exchange of contracts’ is the term used when a buyer and seller meet in person, along with their respective solicitors, to quickly complete the property deal.

There are a number of reasons why the buyer and seller might want to quicken the property transfer, as we describe below.

• You’re a buyer wanting to purchase a highly desirable property before another buyer gets their foot in the door
• You’re a developer that has a strong interest in the available property
• You’re a cash buyer who is in a position to buy the property immediately without the help of a mortgage company
• You’re a seller with an urgent need to release cash from the sale of your property

How it’s done

• All the parties involved meet face-to-face on the same day (usually at the offices of the seller’s solicitor)
• Both sides work through the sales papers
• An agreement is made and the exchange occurs

If one of the parties can’t attend in person, they make themselves contactable by phone.

Pros & cons

These include:

Pros of attending the exchange of contracts

• The seller can benefit from the proceeds of the sale
• The seller doesn’t have to wait for another buyer
• The buyer can purchase the property before they are gazumped
• Negotiations are straightforward as both the buyer and the seller are in the same room (in person or on the phone)
• Superficial issues can be resolved quickly

Cons of attending exchange of contracts

• As there is no time for a property survey, the buyer might regret the decision to purchase the property if they later discover issues in the house
• Less time to arrange buildings insurance, removals, etc.
• Conveyancing costs are more expensive

Can you pull out after the contracts exchange?

After exchanging contracts, the buyers and seller are legally bound to complete the sale. It’s still possible to pull out of the deal after this point but as this would be a breach of contract, the buyer or seller would face losing your deposit money.

Advice for buyers

If you pull out of the transaction after you exchange contracts, you will lose your deposit and you may have to pay interest on the unpaid purchase price and conveyancing fees.

As such, it’s wise not to exchange contracts unless you are sure you want to go ahead with the property purchase. If you have any doubts at all, hold off until you are satisfied that the property meets your financial and personal needs.

Advice for sellers

If you pull out of the sale after the exchange date, you are liable to cover the costs incurred by the buyer. These include the survey fee and the solicitor’s fee.

As well as the financial costs you will incur, there is also the chance that estate agents will be wary about working with you. They don’t get paid when transactions fail so they might be reluctant to represent you again.

Therefore, be absolutely certain that you want to sell your property before exchanging contracts so as to avoid any penalties.

How to speed up exchange and completion

One way to speed up exchanging contracts and completion is to carry out the processes for both on the same day. But as this isn’t always advisable, there are other ways to speed up the process.

Firstly, make sure you respond to requests for information quickly. If you are slow to respond to your conveyancer’s request, then the house-moving process will naturally slow down as a consequence.

Secondly, be sure to stay in regular touch with your conveyancer and estate agents. You may need to hurry them along if they are dragging their feet, or you may need to check for any issues that you can help resolve.

It will also help if you can agree on a completion day at an early stage as this will give everybody a target to work towards.

Tips to speed up the process for buyers

• Provide your conveyancer with everything they need from you, including the paperwork related to your mortgage offer and the monies required for property searches
• Make sure your deposit funds are accessible to your solicitor when you are getting close to the exchange date
• Choose a mortgage broker that can expedite mortgage offers
• Choose a trusted and experienced conveyancer
• Don’t go on holiday during the final stages of exchange and completion
• Sign the contract on the same day you receive it

Tips to speed up the process for sellers

• Gather the paperwork for your property early, such as receipts for any work that has been carried out and documentation relating to electrical and gas certification
• Hire the services of a solicitor before you are made a formal offer, as they will be able to get the title deed from your mortgage lender and prepare the sale contract at an early stage
• Choose somebody you can trust to carry out the conveyancing process
• Respond to requests for information in a timely manner
• Complete the fixtures and fittings/property forms as soon as you receive them
• Be accessible, even if this means postponing your holiday plans

What should the estate agent be doing during all this?

The estate agent will:

• Liaise with each party to make sure the transaction is going along smoothly
• Update the buyer and seller with information pertaining to the transaction
• Use software that gives the buyer and seller a login page to check for updates about the transaction (not all estate agents have this)
• Help to manage any problems that may arise during these final stages

Buyers: What needs to happen before I can exchange?

As a buyer, you must make sure:

• You receive a mortgage valuation from your lender and get approved for an official mortgage offer
• You have the money needed for your mortgage deposit
• Your deposit funds are cleared with your legal company
• You sign the sale contract
• You sign the deed of transfer (this isn’t always necessary if the seller has already signed it)
• You arrange buildings insurance for the property
• You agree to a completion date

Your conveyancer must:

• Have possession of the deed of transfer and the signed contract
• Be in possession of your deposit
• Check for any issues on the property survey
• Confirm (and have possession) of your mortgage offer
• Be in possession of your buildings insurance policy
• Prepare a completion statement (the document that itemises the financial transactions related to the house sale)

Sellers: What needs to happen before I can exchange?

As a seller you must:

• Respond to all enquiries by your conveyancer
• Provide all documentation required (such as warranties and gas certifications)
• Sign the contract and transfer of title
• Agree on a completion date
• Be in possession of all necessary paperwork, including the signed contract and transfer of title document
• Check to see that the buyer’s deposit has been lodged with their legal company
• Have an estimate of the mortgage redemption costs (outstanding balance and fees)

How do solicitors & licensed conveyancers exchange contracts?

In the past, solicitors and conveyancers would meet up in person to exchange contracts but these days, they are more likely to use the telephone.

During their conversation, they will agree to and confirm the terms of the contract. They will also make sure the required funds and documentations are in place.

Once they have confirmed and agreed to all this, the exchange of contracts will take place.

What is the process?

• The solicitor at the bottom of the property chain will contact the next one up and confirm that they have the signed contract and deposit in their possession
• The same solicitor will confirm a time for the exchange with the other legal representative
• The previous steps will take place between the other solicitors in the property chain
• The exchange will be confirmed down the chain to each legal representative
• If everybody is in agreement, the exchange will take place (if there are any issues, the exchange process will begin again the following day)

How long does it take to exchange contracts on the day?

It depends on how many people are in the property chain. If there is only one buyer and seller, then it will take no time at all. But if there are several people in the chain, it could take all day due to the number of mortgage companies and legal firms involved.

Why might the exchange not happen on the day it’s supposed to?

A delay might happen if there is a holdup with any paperwork or mortgage deposit funds, or if a solicitor or their clients aren’t contactable for any reason. A delay might also occur if the solicitor isn’t a very good one so it’s wise to do your research before picking a legal representative to minimise the possibility of something going wrong on exchange day.

Once the buyer and seller are legally bound to the transaction, the following will occur.

Who does what?

Below we look at what the buyer, buyers conveyancing, seller, and the sellers conveyance must do between the exchange of contracts and completion day.

• Arranges removal service
• Starts packing
• Contacts their utility companies and broadband suppliers about their impending move

Buyer’s conveyancer:

• Confirms the transfer of mortgage funds with the mortgage lender
• Checks terms on the lease (in the case of leasehold property )
• Draws up the completion statement
• Arranges removals
• Leaves a set of keys with their estate agent

Seller’s conveyancer:

• Confirms the mortgage redemption amount with the lender

How long is it between exchange and completion?

Completion dates are typically within 14 days after the exchange of contracts but there can be a longer gap if:

• The buyer is in rented accommodation and they need to give notice to their landlord
• The property is a new build and building work isn’t finished
• The seller hasn’t secured their next property purchase
• A mortgage offer has expired

The buyer’s funds are transferred to the seller’s conveyancer. At this point, the transaction is complete and ownership transfers and the seller must vacate the property.

What can cause delays on completion day?

Delays can be caused if:

• There is a holdup with the transfer of monies
• The seller hasn’t been able to vacate the property
• There are problems with the removal process

What happens if completion doesn’t take place?

As both the seller and buyer are legally bound to a contractually agreed date, they will be in breach of contract if they cause a delay to happen.

If the buyer fails to complete, they will be served with a notice that tells them they have 10 working days to complete before the contract is revoked. After this time, the seller has the right to a) pursue the buyer for financial compensation, and b) resell their property to somebody else.

If the seller fails to complete, they are liable for the buyer’s costs. They must also return the deposit paid to them. The buyer has the right to rescind the contract if it hasn’t been revoked already.

What happens after completion?

Below we look at what happens on the day off and after completion day and who does what.

Below we look at what the buyer, buyer conveyancing, seller, and sellers conveyancer must do on and after the day of completion.

• Receives the keys to the property
• Checks that everything in the property is in order (as agreed in the contract of sale)
• Changes the locks
• Sends meter reading to their utility companies
• Lets their contacts know their new address details
• Updates their driving licence and council tax details

Buyer’s solicitor

• Transfers the deposit to the seller’s solicitor
• Registers the title deed with the Land Registry
• Submits the Stamp Duty Land Tax return and arranges for Stamp Duty to be paid to the HMRC
• Sends the buyer the Title Information document and SDLT5 certificate as evidence of Stamp Duty paid
• Takes the final meter readings
• Vacates the property
• Hands keys over to the estate agent
• Updates their driving licence and council tax with new address information

Seller’s solicitor

• Pays the estate agent’s bill
• Receives monies owed to them
• Redeems seller’s mortgage
• Pays monies owed to the seller

What is the buyer’s completion statement

The buyer’s solicitor will give them a statement that itemises all the financial transactions that have taken place (and that are still required) during the exchange and completion process.

It will include:

The total amount the buyer will pay the seller on completion

• Purchase price
• Additional payments that have been agreed upon

Fees, taxes, and charges

• Stamp Duty Land Tax
• Property search fee
• Land Registry fee
• Fees for pre-completion and identity checks
• Solicitor fees

Monies already paid/received by the legal company

• Exchange of contract deposit
• Mortgage advance

This isn’t a definitive list of what to expect on the statement as other fees may also be required.

Frequently Asked Questions

How much time is needed between exchange and completion.

Exchange and completion can sometimes take place on the same day - known as a simultaneous exchange (or attended exchange) - but as delays could take place, as might be the case if mortgage funds are held up, it's better to leave a gap. A typical timeframe between the exchange of contracts and completion is 1-2 weeks.

What is the maximum time between exchange and completion?

The timeframe can exceed 2 weeks (even up to several months) so if you aren't able to complete earlier and you need an extended amount of time between exchange and completion. make sure you're upfront about the time you need at the beginning of the process.

Can you exchange contracts without a completion date?

No, as the completion date needs to be written into the contract before the exchange takes place.

How far in advance can you exchange contracts before completion?

In most instances, you can exchange contracts 1-4 weeks prior to the completion date, but a longer timeframe may be possible if both the seller and buyer agree.

Can anything go wrong between exchange and completion?

Unfortunately, yes.

A number of things can go wrong between exchange and completion. For example:

• If you lose your job or if your income is impacted in another way, your lender might rescind your mortgage offer and refuse to release mortgage funds.
• If the buyer or seller falls ill, this could stop them from completing.
• The purchase money required by the seller's conveyancer might not arrive on time.

These are just a few worst-case scenarios but don't let this put you off a house move, as most completion dates are met when the buyer and seller are able to overcome the obstacles in their way.

• A TREE PLANTED FOR EVERY MORTGAGE

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Steve Roberts (MAQ)

Stephen Roberts MAQ is the founder of YesCanDo Money, one of the UK's largest no-fee mortgage brokers. With more than 30 years of hands-on experience in the mortgage industry, Steve really knows the ins and outs of mortgages. He's become a trusted expert and authority in the field, thanks to his deep understanding of the mortgage landscape. Speak to Steve or a member of his knowledgeable team today by completing our contact form:

YesCanDo Money is a trading name of Roberts Financial Services Ltd which is authorised and regulated by the Financial Conduct Authority, authorisation number 527815. Your home may be repossessed if you do not keep up repayments on your mortgage.

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What Does Exchange of Contracts Mean?

Who is this page for.

This page is for people buying a home who want to know what the exchange of contracts and completion means.

In this article

What is the exchange of contracts, what happens at the exchange of contracts, what time of day does the exchange of contracts happen, what is a completion date, how long between the exchange of contracts and completion, what do you need to prepare for the exchange of contracts, what can hold up the exchange of contracts.

Exchange of contracts is when both parties swap and sign the contracts. This is the point where you as the buyer will be asked to put down your deposit.

This is a crucial stage of buying a home. Once the contracts are signed, you will be legally bound to buy the home. If you wanted to pull out after this stage, you will lose your deposit. It also protects you if the seller backs out of the deal.

Once the contracts are exchanged, you and the seller can agree your completion date. This is when you will get the keys to your new home.

At the exchange of contracts, the solicitors for both parties will be in contact, usually over the phone. Here, they will read out and finalise the contract for your new home.

This is a good point to share anything you are unhappy or unsure about. This could be any repairs that need doing before you get the keys. These can then be noted in the contract to hold the seller liable for fixing them.

During this process, the solicitors will also set a completion date. This is where the house becomes yours and keys are handed over.

Once both parties are happy with the deal and completion date, the contract is signed and exchanged.

Exchange of contracts process

There are a lot of actions to address before the contracts can be exchanged and signed. This can delay or extend the process.

Here is a general rundown of the process:

• A survey of the house has been completed. The buyer and seller has agreed on any repairs or a new price based on this.
• The buyer has an offer for a mortgage confirmed.
• The seller has gathered all the paperwork for the home.
• The two solicitors set up a recorded phone call. Any issues are addressed and added to the contract.
• The seller's solicitor drafts up a contract and sends it to the buyer's solicitor to sign.
• The contract is signed and sent back to the seller's solicitor.
• Both parties agree on a completion date. The buyer's solicitor also arranges to send over the deposit to the seller.

There is not a set time or day where contracts are exchanged. Instead, it will depend on each solicitor’s schedule.

This can also change due to delays. So be prepared to see your exchange of contracts pushed back if there are still actions to complete first.

A completion date is when the property becomes fully yours. This is the day you will get your keys and can move in.

This date is agreed during the exchange of contracts. There is a fine for any legal firms who do not meet this date. So, you can be fairly confident when booking any removal men or storage resources.

Once the contracts are exchanged, it usually takes between 7 and 28 days to reach your completion date. But this can be longer or shorter, depending on the buyer or seller’s wishes.

For example, if the seller cannot move to their new home in this time, they may ask for a longer completion date.

To complete the exchange of contracts, each party has a number of items to tick off and finalise. This is what can slow down the process and cause delays in getting your keys.

As a buyer, you should:

• Get written proof of your mortgage offer
• Have the money for your deposit ready
• Set up a survey for the property
• Flag any concerns to your solicitor
• Let your solicitor know if you are part of any government schemes. This could be owning a Help to Buy ISA

As a seller, you should:

• Collect all the paperwork about the house for the new owner
• Make any pledges for repairs flagged in the house survey
• Fill in the related forms, such as the property information form (TA6)

Both the buyer and seller should:

• Agree on a completion date
• Agree on a new price, if relevant
• Sign the contracts

There are many factors that can hold up your exchange of contracts. This includes:

• Ongoing issues. Are you and the seller still negotiating the price after a house survey? Are you still unclear what fixtures are included? Is your solicitor not convinced these concerns have been addressed? All of these factors can delay the signing of contracts.
• Delays with the buyer/seller. There are things the buyer needs to sort before the contracts can be exchanged. A seller has several forms to fill out before contracts can be signed. Missing or pushing back on this can delay things.
• Scheduling clashes. Both solicitors need to agree on a day and time to exchange contracts. They will both have many other clients and appointments too. This can make finding a date to suit tricky.
• External setbacks. This could be the buyer has yet to get their mortgage in writing. Or maybe the seller is facing delays with their own house purchase. Either way, these external factors can push things back.

The content on this page is for reference and does not constitute finance advice.

For impartial financial advice, we recommend government bodies like the Money Advice Service .

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Exchanging contracts - what this actually means when buying a house

Exchanging contracts is a pivotal moment in the home buying process - but what does it actually mean?

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Exchanging contracts is a crucial milestone in the home buying and selling process. Until contracts have been exchanged, both buyer and seller can each walk away from the sale and nothing is guaranteed.

Here we explain what’s involved and the things you can do to ensure you’re able to exchange contracts as quickly and easily as possible.

What does exchanging contracts mean?

The exchange of contracts is the point at which the sale of a house becomes legally binding, both to the buyer and the seller.

In order for the sale to proceed both the buyer and the seller need to sign copies of an identical contract and the buyer needs to pay a deposit – typically 10% of the purchase price. This is separate to the mortgage deposit .

Nick Owens a property partner at Keystone Law explains: 'The seller’s solicitor prepares the contract which is usually a very simple two sides of A4 document which includes standard terms (details of the buyer and seller, the details of the property and the agreed price and deposit) and conditions.'

In addition to the standard terms the contract may also include any ‘chattels’ that have been included in the sale, for example furniture or white goods.

Once the contract has been signed, solicitors representing each party then read copies of the contract over the phone to each other in a recorded conversation before posting the signed copies to each other.

At what point in the process do you exchange contracts?

Before contracts can be exchanged, you (and your solicitor) need to be sure that you are happy to buy the property at the price that has been agreed.

This means it cannot happen until the necessary searches and surveys have taken place and any questions or queries that may have arisen as a result have been resolved.

Kate Hathaway, a property solicitor at Keystone Law adds: “The buyer will also need to have received their mortgage offer before exchange of contracts.” This will provide the necessary evidence that you’ve got the money to buy your new home.

You’ll also need to have bought buildings insurance for your new home and have agreed what fixtures and fittings are to be included in the sale.

A completion date should also be agreed.

According to Halifax , it typically takes between eight and 12 weeks to go from offer acceptance to exchange of contracts. However, just how long it takes you will depend on the results of the searches and the building survey.

If any problems arise, these can take time to resolve.

The length of your chain can also make a difference, the shorter it is, or if your process is chain-free , the less complicated it is likely to be and the faster you can hopefully exchange.

Can a buyer or seller drop out after contracts have been exchanged?

Once contracts have been exchanged the buyer is legally bound to buy the property and the seller is legally bound to sell it.

This means that if either party were to pull out, it would be considered a breach of contract and there would be significant financial penalties.

The buyer would lose their deposit and may have to pay interest on the outstanding balance of the completion funds. The seller, meanwhile, would become liable for the costs that the buyer has incurred so far.

This is why it’s vital all parties must be certain that they want to go ahead, before they sign the contract.

Even though the seller doesn’t have as much to lose by backing out at this stage, it’s worth pointing out that it is incredibly unusual for sales to collapse after contracts have been exchanged.

What happens after exchanging contracts?

After contracts have been exchanged, there is still a fair amount of work that needs to be done before the transaction can complete. That said, it’s less fraught because the difficult work has been done and you should at least have the confidence that your move will go ahead as planned.

Nick Owens says: 'Once contracts are exchanged, the solicitors swap their clients' signed parts of the contract and the buyer and the seller then sign transfer deeds to transfer the ownership of the property in readiness for completion. The buyer's solicitor will collect the money from the buyer and his mortgage company (if applicable) that they need for completion and will carry out final checks and prepare the stamp duty land tax return.'

It's a busy time for the buyer and seller too who will need to start preparing for the move in earnest, for example packing and arranging removals. It’s also a good idea to contact utility providers and arrange mail redirection ahead of the big day too.

Can you exchange contracts without a completion date?

The completion date needs to be included in the contract and unfortunately for those seeking flexibility, you can’t exchange without it.

All parties involved in the sale need to agree on the completion date, which is usually scheduled for a few weeks after exchange.

This allows both buyer and seller the necessary time to pack up and arrange their move.

Can you exchange contracts and complete on the same day?

Completion is the final stage in the home buying process. All payments are made and the title documents are transferred to the new owner. The seller vacates the property and the buyer can finally move into their new home.

If you are in a real hurry, or it’s been such a stressful experience building up to exchange, you may want to wrap things up as quickly as possible by exchanging contracts and completing on the same day.

However, while it is possible to exchange contracts and complete on the same day, Daniel Knott, mortgage adviser at Active Financial, points out that it may only add to your stress. 'There are a lot of different parties within a chain and therefore a lot of moving parts to all work for completion to occur. If there are any issues throughout the chain, this could be delayed. This can be inconvenient and costly if you have booked removal vans, taken time off work or redirected your mail.'

Kate Hathaway takes a similar view. 'The risk of not having time between exchange and completion is a lack of certainty in the transaction — until contracts are exchanged either party could walk away from the transaction at any point without penalty. An exchange of contracts provides the certainty to all parties that completion will occur on a specific day.'

Is the fee for exchanging contracts included in the solicitor’s fees?

Yes. Your solicitor’s bill will be made up of two parts – a fee for their services (including exchange of contracts) and disbursements. Disbursements are additional legal costs charged by third parties, for example searches, fraud checks, stamp duty and bank transfers.

Tips for exchanging contracts as quickly as possible

Daniel Knott says it’s a good idea to keep talking to your solicitor.

'It’s essential you work together with your conveyancing solicitor. A good solicitor will tell you the individual who will be looking after you and your purchase or sale. This means you’ll know exactly where to direct your queries or concerns.'

'The biggest stress is usually uncertainty, this is especially true for first-time buyers who haven’t experienced the process before. Communication with your conveyancing solicitor will ensure you understand what’s already been done, what stage you’re at currently and what is still to come.'

Kate Hathaway, also recommends that buyers act quickly and get everything they need to do done as soon as possible. 'Although there is some financial risk involved, get your mortgage application in, your solicitor instructed and your survey commissioned as soon as possible. This will help you flush out any issues as soon as you can.'

She adds that you might also want to try and avoid being in a chain, if it is at all possible. 'A chain will only ever move as quickly as the slowest link and it can be difficult getting information further down the chain.'

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Exchanging contracts and settlement

With a contract of sale agreed upon and finance in place, it's time to exchange and settle. Learn what steps and parties are involved, plus fees to be aware of.

Prior to exchange

Before exchanging contracts, several steps generally need to be undertaken, including:

• completing all relevant property inspections and checks
• reviewing and discussing the contract of sale with your solicitor or conveyancer
• confirming financial arrangements.

Exchanging contracts 

Exchanging contracts legally completes the property sale process. It means the seller has accepted the buyer's offer on the home and both have signed the contract of sale.  

At the time of the exchange you will be required to pay the deposit for the home you are buying.

Cooling-off period

Private treaty sales in NSW have a 5 business day cooling-off period after contracts are exchanged.

The cooling-off period starts as soon as you exchange contracts and ends at 5pm on the 5th business day after exchange.

During the cooling-off period, buyers can withdraw from the sale as long as you give written notice. Usually there are financial penalties if you do this and it's worked out as a percentage of the sale price. 

There is no cooling-off period for homes bought at auction. The contract of sale must be finalised after the auction is completed. It is recommended you consult a solicitor or conveyancer before you attend an auction.

Changes to the land title system

From 11 October 2021, certificates of title ceased to be issued in NSW. Property ownership details continue to be recorded on the NSW Torrens Title Register. 

Existing certificates of title are no longer valid legal documents. You do not need to destroy a certificate if you already have one.

All land transactions will be lodged online using the Electronic Lodgment Network Operators. You can conduct a title search at NSW Land Registry Services Online . 

Learn more at the Office of the Registrar General .

Settlement is the process of paying the remaining sale price and becoming the legal owner of a home. At settlement, your lender will disburse funds for your home loan and you'll receive the keys to your home.

Generally, settlement takes place around 6 weeks after contracts are exchanged. Your conveyancer or solicitor can check and negotiate the settlement period with the seller. 

You'll need to have money to cover settlement, including:

• legal costs 
• conveyancing fees 
• transfer duty, also known as stamp duty
• unpaid lending charges such as Mortgage Lenders' Insurance (LMI) or loan establishment fees, if applicable.

Some sale contracts will allow buyers to carry out a final inspection of a home on the day of settlement. This inspection is to make sure the home is in the same condition as when contracts were exchanged.

After settlement and a final inspection is complete, you can move into your new home.

Learn more about sale contracts and settlement when buying a home at NSW Fair Trading.

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Contract exchange and completion when buying a home

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Work and Redundancy

Until the exchange of contracts, both the buyer and seller of the home can pull out of the deal without incurring serious costs. This guide examines the process, including how long it takes to go from exchange to completion, how to pull out of a house sale before exchange and how to prepare for your move.

Before you exchange contracts

Exchanging contracts, completion date, tips for preparing to move, your next step.

Exchanging contracts is legally binding, so be certain you want to go ahead before signing anything.

Use our helpful checklist to make sure you haven’t missed a step:

• Check the searches are complete.
• Check you have your mortgage offer in writing.
• Check you have the funds for your mortgage deposit.
• Make sure you’ve agreed on a completion date for sale.
• Check the contract your solicitor will send before signing and returning it.
• Ask your solicitor to explain any conditions or terms you don’t understand. Keep in regular contact to prevent any hold-ups in processing the paperwork.
• Make sure you know what’s included in the offer, e.g. fixtures and fittings, and have it put in writing.
• Check you have funds for a holding or contract deposit if the seller requires one (typically £500 to £1,000).
• If the seller pulls out before you exchange contracts, you have no legal right to recover any costs from them, though you can take out indemnity insurance to cover wasted costs – your solicitor can advise you about this.
• Check the Energy Performance Certificate (EPC) for your new home. This rates the energy efficiency of the building. The EPC will also recommend how to improve your home’s efficiency.
• If sellers attempt to renegotiate the purchase price at this stage, get advice from your solicitor and ask them to help you with the negotiations.
• Organise buildings insurance and make sure it’s valid from your exchange date. Find out more in our guide Protect yourself and your home .

During the exchange of contracts, the solicitor or conveyancer will read out the contracts over the phone in a recorded conversation.

They will make sure the contracts are the same and then post them to each other.

Once contracts have been exchanged and you’re legally bound to buy the property to:

• tell the freeholder (if it’s a leasehold property) you’re the new owner
• check the solicitor/conveyancer has registered transfer of ownership with the land registry
• Ii it’s a share of freehold purchase, the solicitor will arrange for a new share certificate to be issued.

This is the date when you are able to move into your new home.

The estate agent is likely to hold the keys for you to pick up.

• On completion day, your solicitor will arrange for money to be transferred to the seller’s solicitor.
• Ideally, all the buyers and sellers in the chain complete on the same day, otherwise you might have to wait for the seller to have completed buying their new home before you can move in.
• If you have a share of freehold, find out how to register your name on the company register.

How long between exchange and completion?

The time it takes to go from exchange to completion is decided by the buyer and seller.

It can sometimes be affected by other parties within the chain. For example, if the seller is waiting for a house purchase of their own to go through before moving out.

• Organise post forwarding.
• Notify everyone you’ve changed address – driving licence, banks, pension company, work, mobile phone company, etc.
• Register with utility companies, broadband suppliers, water suppliers and for council tax.
• Before moving in, ask the sellers where the main stopcock and energy meters are and check fixtures and fittings are in place (if applicable).
• Ask for the instruction manual for any electrical goods they are leaving behind.
• You will also need door and window keys.
• Collect keys and clean the property before the removal firm arrives.
• If you have young children and pets, arrange to have them looked after on moving day.
• Keep valuable items, such as jewellery, with you.
• Pack a box of essentials for your first day in your new home. This could include a kettle, mugs, coffee/tea, toilet paper, toothbrushes and toothpaste.

This article is provided by the Money Advice Service .

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Home » Blog » Selling Advice » Exchange Of Contracts And House Completion Explained

Exchange Of Contracts And House Completion Explained

Selling your house is a stressful process. When you finally get to the point where you exchange contracts and complete the sale, you can typically breathe a big sigh of relief. What can go wrong between exchange and completion and understanding exactly what happens between exchange and completion, though, are key to the home selling process and ensure it’s smooth.

What Happens at the Exchange of Contracts?

Wondering exactly how an exchange of contracts works? At the actual exchange of contracts, both solicitors have a signed contract. The seller’s solicitor has a signed transfer of title deed while the buyer’s solicitor has a deposit of funds that have been cleared as well as a mortgage offer. The two parties have also likely agreed on a completion date. From there, the solicitors confirm that everyone is in possession of the right legal documents, and an electronic “exchange” of materials happens. “Contracts exchanged” just means the solicitors have electronically sent copies of the contracts to each other.

What Happens After the Exchange of Contracts?

Between the exchange of contracts and completion, a number of different things happen. Once the completion date has been set, you have a number of things to do. Exchange of contracts vs. completion means a few different things. After you’ve exchanged contracts, you’ve already agreed on the terms, so if you’re the buyer, you’ll need to make your plans to move and contact all utilities and services to inform them of the impending service transfer. Your conveyancing solicitor will work to ensure your mortgage lender is on track to transfer the money. If you’re the seller, you need to start packing and confirm your removals services. Your conveyancing solicitor will draw up the completion statement and confirm the redemption amount with the mortgage company.

The last step in the process is completion day, and on that day, the money is transferred between solicitors and the seller must leave the property.

Still, have questions about exchanging contracts and completing the sale? Here are a few of the most frequently asked questions.

Can You Exchange and Complete the Same Day?

It is legally possible to exchange and complete on the same day, but it’s not legally advisable. There are a number of things that have to happen between the exchange and completion, and should just one of them go wrong, you could be looking at a lengthy delay.

What Time of Day Does the Exchange of Contracts Happen?

There is no specific set time of day, but often the exchange happens around midday.

Who Is Responsible for House Insurance Between Exchange and Completion?

Exchange 2 Completion Insurance is solely the responsibility of the buyer. Exchange to completion insurance isn’t difficult to get, but it is an absolute must. In most cases, your mortgage lender will absolutely insist on that proof of insurance, too, so work in advance to find the right policy to meet your needs.

Can You Exchange Contracts Without a Completion Date?

The completion date is listed in the contracts themselves, so you cannot exchange contracts until the two of you have agreed on a completion date.

Who Decides Completion Date?

Your house completion date is decided by both the buyer and the seller. Typically, this happens four weeks after the exchange of contracts, but it could happen as soon as two weeks after the exchange. Just work together to find the right date to meet your needs.

Is the Completion Date the Same as Moving Date?

The completion date and moving dates are one and the same for the seller. The seller literally hands over the keys to the property on the completion date, so they must have already been out by that time. Once that is complete, the buyer can begin moving in at any point.

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Exchange of contracts explained

Discover what the exchange of contracts means for your house move.

What is the exchange of contracts?

In England and Wales, exchange of contracts is one of the last stages of buying a house.

It’s the point where you sign a contact agreeing to buy a house and the seller signs a contract agreeing to sell the house to you. Then your conveyancers “exchange” these contracts. This is the stage when you’ll pay your deposit.

By signing the contracts, you’re committed by law to buying the property. Once the contracts have been exchanged, the buyer and seller can’t back out.

The exchange can only happen once your deposit is in place and ready to go. By this stage, you’ll have approval for your mortgage.

How does exchange of contracts and completion work?

The exchange of contracts will be handled by your solicitor. Before the exchange can happen, you’ll need to make sure of the following:

• The lender’s  valuation  has been carried out
• You have a  mortgage offer  from your lender
• You’ve agreed  what’s included  in your offer (fixtures and fittings, furniture)
• You’ve signed your  copy of the contract
• Your solicitor has transferred your  deposit

Once that’s all done, you can exchange contracts. If you’re buying a house, this is the exciting bit. You’ll be given a moving in date shortly after this point.

You will need to arrange buildings insurance for your new home before the exchange of contracts. This covers against the cost of damage to your new home from things like fires and floods.

How long does it take to exchange contracts?

It usually takes around eight to 12 weeks to reach the point where you’re ready to exchange contracts. The actual process is quite speedy, requiring a phone call between the buyer’s and seller’s solicitors.

What happens after the exchange?

Once your contracts have been exchanged, you can start to look forward to moving day . There are a few things you need to sort ahead of this:

• Book removal vans or rope in friends or family to help you move.
• If you’re buying a leasehold property , you’ll need to tell the freeholder that you’re the new owner.
• Check your solicitor has registered your details with the land registry for the transfer of ownership.

How long is there between exchange of contracts and completion?

Your solicitor will discuss dates for completion with you once your contracts have been exchanged.

Usually, there’s a period of one to three weeks between exchange and completion, but this may be longer depending on the size of your  chain .

Equally, it’s common for the exchange and completion to happen on the same day, so you can get moved in quicker.

The content on this page is for reference and does not constitute financial advice. For impartial financial advice, we recommend government bodies like MoneyHelper

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How to Exchange Contracts when Buying a House

Last Updated: September 7, 2019 References

This article was co-authored by wikiHow Staff . Our trained team of editors and researchers validate articles for accuracy and comprehensiveness. wikiHow's Content Management Team carefully monitors the work from our editorial staff to ensure that each article is backed by trusted research and meets our high quality standards. There are 10 references cited in this article, which can be found at the bottom of the page. This article has been viewed 3,762 times.

In the United Kingdom, you “exchange contracts” after you have identified a house or flat that you want to purchase and have made an offer that has been accepted. Once you sign the contract, the solicitors for both the buyer and seller will read the contracts to each other over the phone. This is called “exchanging the contracts,” and its purpose is to make sure that the contracts are the same. Until contracts are exchanged, either party may pull out of the sale without serious penalty. [1] X Research source Exchanging contracts, however, binds the parties to the sale.

Using a Solicitor to Exchange Contracts

• Also make an agreement for anything to be fixed, or for fixtures to be added to the property. For example, if you agree to purchase a flat provided that the owner replaces tiles in the bathroom, then make sure that you understand these changes are part of the contract.

• A solicitor is a licensed attorney, whereas a conveyancer is not. Nevertheless, conveyancers specialize in property and must be members of the Council for Licensed Conveyancers.
• You should consider a conveyancer if you are trying to save money. Conveyancers are generally less expensive than solicitors. [3] X Research source
• a boundary dispute
• a lease extension as a part of the transaction
• the sellers are getting divorced

• If you are getting a mortgage, then you might have to use a solicitor or conveyancer approved by the mortgage lender. You might have to pay the bank's representation fee if you choose not to.
• You can find a solicitor or conveyancer locally. For example, you might have used a solicitor to help you draft a will. If so, you can ask if he or she can help you with the exchange of contracts.
• You do not have to work with a local solicitor or conveyancer. Instead, you could use an online conveyancer. These businesses will work with you entirely online. You communicate by email or phone, and you can access your file through their web-based system. Online conveyancers are usually less expensive; however, they are not appropriate for handling complicated legal issues, for which you will need a solicitor.
• To find a solicitor, visit the website for the Council for Licensed Conveyancers or the Law Society.
• To find a conveyancer, you can compare quotes by visiting the Home Owners Alliance Conveyancing website. [4] X Research source

• How much experience do they have exchanging contracts? You will want to hire someone with sufficient experience so that nothing goes wrong.
• Do they communicate by email? You will want someone who you can reach easily, especially as you approach the day of completing the sale. Solicitors are sometimes difficult to contact, so if you are looking to hire a solicitor, make sure you understand their policy on client communication.
• What do they charge? You can comparison shop by contacting a few solicitors and collect their fee information. [6] X Research source

• An offer for a mortgage in writing.
• Money set aside for the mortgage deposit.

• After reading the contract, you should then sign it. [11] X Research source

• The purpose of reading the contracts to each other is to make sure that they are identical.
• After confirming that they are identical, the solicitors then immediately send their copy of the contract to the other solicitor through the post. [12] X Research source

Exchanging Contracts without Hired Assistance

• Going alone is also difficult. You might find that you need to hire a solicitor or conveyancer to get answers to questions that you have. In this situation, you might be better off hiring a professional from the start.

• any promised repairs or additions to the property
• the length of the lease, if the property is a leasehold
• Raise objections. If you see something in the contract that is wrong, then contact the seller's solicitor. You might have to go back and forth many times, amending the contract each time.

• Local authority search. This search will reveal what plans the authority has for your property. For example, there might be a plan to build a road. You should search before signing the contract. Local authority searches cost £70-400 and can take six weeks to obtain.
• Chancel search. This search is necessary to uncover whether there are potential medieval liabilities on the property which were meant for church repair. You should check to see if the liability has been listed on the land register.
• Environmental search. You should get this search to uncover contaminated land, including landfill sites. The search also provides detailed flooding predictions and ground stability issues. You can get this from either Ground sure or Landmark and costs £50-60.
• Water authority search. This costs around £50-75 but is necessary in order to find out where you get your water and where public drains are located.

• Each document costs £3. [16] X Research source

• If the contracts are the same, then you can sign your copy and slip it in the post, addressed to the seller's solicitor. [17] X Research source

Completing the Sale

• If the seller agreed to install fixtures, then make sure that they have done that.

• Also be sure to register the transfer with the land registry. [19] X Research source

• Make sure to notify the bank and the post of your new address. Your post can be forwarded to your new address.
• You also should have your driving licenses updated with your new address.

• Typically, if a house is damaged during the period between the exchange of contracts and completion, then the buyer cannot get out of the contract. Accordingly, you will need insurance to start the date you exchange contracts, not the date of completion.
• The contract might alter this rule. For example, the contract might state that the seller will carry insurance on the building during this period. Check the contract.

• The mortgage lender might not transfer money in time. If the transfer is not completed by 3:00 pm, then you will have to wait until the next day to complete the sale. [22] X Research source
• A seller might make an outrageous demand for more money at the last moment. If you are packed and ready to move, then you might feel that you have no choice but to give into the demand.
• Accordingly, you may want to schedule completion for several weeks after you exchange contracts.

• Make sure to call your solicitor. The money must pass from the buyer's mortgage company to the buyer's solicitor, and then pass from this person to the seller's solicitor. Be sure to call in the morning and make sure that everything is set.
• If you don't hear anything during the day, be sure to check up on your solicitor. You don't want the conveyance of money to be slowed down because your solicitor is not giving the matter close attention.

Expert Q&A

• In order to settle on a fair price for the property, you might want to have a survey done. About 80% of buyers do not have a survey performed, but it can be helpful if you are buying an old property or are otherwise unsure about the building's condition. To have a survey done properly, you should hire a qualified surveyor. [24] X Research source Thanks Helpful 0 Not Helpful 0

You Might Also Like

• ↑ https://www.moneyadviceservice.org.uk/en/articles/what-you-need-to-know-about-contract-exchange-and-completion
• ↑ http://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/how-do-i-exchange-contracts/
• ↑ http://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/finding-the-right-solicitor-or-conveyancer/
• ↑ http://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/conveyancing-made-easy-for-buyers/
• ↑ http://england.shelter.org.uk/get_advice/Buying_and_selling/the_buying_process/exchanging_contracts
• ↑ http://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/completion-what-to-expect/
• ↑ http://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/what-sort-of-survey-should-i-have/

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Exchange Contract

Jump to section, what is an exchange contract.

An exchange contract is an agreement between two parties that governs the terms of an exchange of goods, services, or money between them. The contract details what is being exchanged, the transaction date, and any other applicable details to the agreement. It also identifies each party of the contract and defines what their roles and responsibilties are under the agreement.

The exchange contract can be used for any situation where two or more parties want to transfer ownership of something from one to the other. It is most commonly used to transfer things like stocks and bonds since it provides legal documentation that such an exchange of ownership occurred.

What's Included in an Exchange Contract?

A typical Exchange Contract should include the following elements:

• Identification of the Parties : The agreement should clearly identify the parties involved in the exchange, including their full names, addresses, and other relevant information.
• Description of the Items : The agreement should clearly describe the items being exchanged, including a detailed description of each item and any relevant serial numbers or other identifying information.
• Exchange of Items : The agreement should specify the terms and conditions for the exchange of items, including the date, time, and location of the exchange.
• Representations and Warranties : The agreement should include representations and warranties by both parties regarding the items being exchanged, including any promises or obligations related to the condition, quality, or value of the items.
• Governing Law : The agreement should specify the governing law that will be used to interpret and enforce the terms of the agreement.
• Signatures : The agreement should be signed by both parties to indicate their agreement to the terms and conditions outlined in the document.

It is important to note that the specific provisions of an Exchange Contract will vary depending on the jurisdiction and the specific needs and circumstances of the parties involved. It is always recommended to seek the advice of a qualified attorney to ensure that the agreement meets the legal requirements and protects the interests of both parties.

Exchange Contract Sample

EXCHANGE CONTRACT

THIS AGREEMENT made on [DATE], between [PARTY 1 NAME], with a mailing address of [PARTY 1 ADDRESS] (hereinafter referred to as "Party 1"), and [PARTY 2 NAME], with a mailing address of [PARTY 2 ADDRESS] (hereinafter referred to as "Party 2").

WITNESSETH:

WHEREAS, Party 1 possesses [ITEM 1 DESCRIPTION]; and

WHEREAS, Party 2 possesses [ITEM 2 DESCRIPTION]; and

WHEREAS, Party 1 and Party 2 desire to exchange [ITEM 1 DESCRIPTION] for [ITEM 2 DESCRIPTION];

NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

• Identification of the Parties . Party 1 and Party 2 are identified as the parties to this Agreement.
• Description of the Items . [ITEM 1 DESCRIPTION] is possessed by Party 1 and shall be exchanged for [ITEM 2 DESCRIPTION], which is possessed by Party 2.
• Exchange of Items . Party 1 shall transfer [ITEM 1 DESCRIPTION] to Party 2, and Party 2 shall transfer [ITEM 2 DESCRIPTION] to Party 1. The exchange shall take place on [EXCHANGE DATE] at [EXCHANGE LOCATION].
• Representations and Warranties . [OPTIONAL: Party 1 represents and warrants that [REPRESENTATION OR WARRANTY REGARDING ITEM 1]. Party 2 represents and warrants that [REPRESENTATION OR WARRANTY REGARDING ITEM 2].]
• Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of [STATE].
• Signatures . This Agreement shall be executed by both Party 1 and Party 2 and shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, and assigns.

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.

Party 1 (Signature) Party 2 (Signature)

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Lawyers with backgrounds working on exchange contracts work with clients to help. Do you need help with an exchange contract?

Post a project  in ContractsCounsel's marketplace to get free bids from lawyers to draft, review, or negotiate exchange contracts. All lawyers are vetted by our team and peer reviewed by our customers for you to explore before hiring.

Meet some of our Exchange Contract Lawyers

I am a commercial contracts attorney with twenty years of experience. I have represented major corporate clients including Amazon, Marvel, and Viacom as well as independent entertainment professionals and technology startups.

Ralph graduated from University of Florida with his JD as well as an LLM in Comparative Law. He has a Master's in Law from Warsaw University , Poland (summa cum laude) and holds a diploma in English and European Law from Cambridge Board of Continuous Education. Ralph concentrates on business entity formation, both for profit and non profit and was trained in legal drafting. In his practice he primarily assists small to medium sized startups and writes tailor made contracts as he runs one of Florida disability non profits at the same time. T l Licensed. in Florida Massachusetts and Washington DC this attorney speaks Polish.

Mexican Lawyer specialized in Corporate, Fintech and Financial Law

Technology and property expert in complex discovery.

Yoann E. A. L.

For over 15 years, I accumulated both hands-on technical and business experience as an IT engineer and entrepreneur, enabling me to understand your challenges probably better than anyone else on the legal market! My California-based full-online practice focuses on: - Intellectual Property (Copyright / Trademarks) - Privacy / Data Protection - Commercial matters (e.g. service contracts) - Corporate (e.g. incorporation, restructuring)

Melanie Cunningham specializes in helping entrepreneurs remain creative and expansive by establishing the foundation of their business and protecting and maximizing their intellectual property. It’s her belief that entrepreneurs and micro and small business owners play a critical role in our communities, which propelled Melanie to return to private practice after more than a decade working for global financial institutions. Melanie’s practice is dedicated to delivering excellent legal support and protection to this vital, but an often underserved, community. Melanie credits her business training and the skills developed as a senior compliance officer with enabling her to help small business owners have a legally compliant business, while proactively advising clients during the growth process. She’s helped diverse entrepreneurs do business in a way that focuses more on collaboration than competition. Melanie has counseled small business owners in determining what is protection worthy (helping them obtain trademarks and copyrights) and making contact on their behalf in the case of infringement.

Christopher B.

Former litigator now focusing on transactional business work

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• Jun 15, 2023

Securing a House: How to Exchange and Finalise Contracts

It is a tough time to buy a home in the UK. With prices sky-high and demand high, it can be really challenging to secure the perfect property for you and your family. Exchange and completion of contracts are the final stages of the process. It’s not always easy to complete the sale of a house.

Sellers want their property to go through the sale as quickly as possible, and buyers need security in knowing the purchase goes through. This stage brings both of those things, making it a priority for everyone when buying or selling a house in the UK.

There are lots of questions to ask, and you need to make sure that you follow all the rules set by law. First-time homebuyers might not understand what it means when exchanging contacts, or why they need a completion statement. But before you give up on finding that dream home, read this article about exchange and completion procedures when buying a house in the UK. It will help you make sure everything goes smoothly – from the exchange of contracts to completion.

Things to get done before exchang ing the contracts

Check the searches are complete.

Check your ability to afford a mortgage deposit.

To avoid any potential misunderstanding, it’s better to have your mortgage offer delivered in writing.

Make sure you understand all the conditions and terms and ask your solicitor to explain anything that isn’t clear. Keep in contact regularly with your conveyancer to ensure there are no delays in processing the paperwork.

Ensure you’ve established an agreement for the date of completion.

To exchange contracts, you need to know what’s included in the sale price. Check that it covers all renovations you want to be done on a property before the exchange of contracts takes place.

Verify the contract that your solicitor will send before signing and returning it.

If the seller requires an upfront payment – contact deposit – to secure the property, you’ll need to check if you have enough funds.

If a seller pulls out of negotiations before you exchange contracts, then you have no legal right to demand repayment for any costs incurred. However, you could take indemnity insurance to protect yourself against wasted expenditure. Your solicitor can advise on this issue.

What are contract exchange and completion?

What’s the difference between exchange and completion? The exchange of contract law usually legally binds the buyer and seller, whereas a completion is a day that they transfer physical ownership of your property. Once the buyer and the seller have exchanged contracts, they can’t back out of the deal.

When do the process of exchange start and end?

Once the buyer and seller have all the paperwork in place, contracts exchange hands. This should happen when all the terms and conditions have been agreed on both sides, including any legal considerations such as exchange of contracts for a property, completion date, and deposit payment .

Contracts are usually exchanged by both solicitors/conveyancers reading out the contracts over the phone. This is recorded by both of them to make sure the contracts are identical. The exchange process can also be done by hand at the desk with documents given to the buyer’s solicitor.

On exchange day, the buyer’s solicitor will usually be present to witness any exchange of contracts that take place. The seller is under no obligation to sell their property on exchange day and may choose not to do so. It is also possible for both parties to come together without exchanging contracts in order.

What is an exchange deposit?

When moving to purchase a first home, you’ll usually save up money to cover the downpayment and also finance your mortgage. On the day of exchanging contracts with the seller, their solicitor will collect 10% of the property value as an exchange deposit.

They’ll keep that money in their trust account until both parties sign the final completion agreement and exchange contracts. This means they haven’t started work on the property yet so it could take a long time.

If you have 5% of your home buy price available as a cash deposit, and 10% is too much for you, it should be possible to negotiate the exchange deposit down with your solicitor.

If you’ve got a bigger deposit than 10%, you’d normally pay 10% at the exchange and the remainder when you complete.

The exchange deposit only becomes a firm contract when the exchange is completed. So it’s important to ensure it is returned in full if you pull out before completion.

How long between exchange and completion?

Some people may not be aware of the time between exchange and completion. But it can sometimes take up to three months or more because there is a lot to do in this period. It can sometimes be affected by other parties in the chain, such as if the seller is waiting for a house purchase of their own to go through before moving out. The time between having an offer accepted and exchanging contracts is generally the longest part of the home-buying process.

The first point at which you’ll know if your offer has been accepted is when you exchange contracts with the seller. This will give both parties another 14 days’ breathing space (known as “cooling off”) should they change their minds about proceeding with the purchase.

The great thing about exchanging contracts is that solicitors will agree on a completion date.

Solicitors can be held liable if they don’t meet this date, which means you don’t have to worry too much when making the purchase of your first house as long as you go through your solicitor.

After the exchange, there’s some paperwork that needs doing. The first is getting lender approval for mortgage lending purposes and checking whether any caveats on sale have expired; checking out home insurance policies etc., finalizing legal agreements between buyers.

What happens on the Completion date?

The exchange of contracts is the culmination of all your hard work and searches. This will be the moment when you finally get to exchange copies of documents with the seller. Then sign them in front of a solicitor or notary public. After that, you’ll take ownership from the seller. It includes pay any outstanding mortgage balances, then finally collect the keys to your new home.

As a buyer, your role on completion day is simple. You wait for a phone call from your conveyancer confirming that your mortgage and deposit have been transferred to the seller.

He has to confirm and completion has taken place.

The estate agent is likely to hold the keys for you to pick up.

On completion day, your solicitor will make sure all money transfers and other steps are complete.

Ideally, all the buyers and sellers in the chain should complete on the same day. Otherwise, you might have to do a ‘handover period’ or wait for them to move into their new home before moving into your old one.

If you have a share in a freehold property, find out how to register your name on the company register. Regarding shares in freehold properties, it is prudent that one registers their name on the company register.

What’s next after the Completion date?

It is important to understand that a completion date stipulates the exchange of contracts and not purchase. Usually, buyers are able to move into the property at this point. But it does not grant them any rights or ownership yet.

The money is transferred electronically between the legal firms’ bank accounts, each one triggering the next transfer. This takes time due to how carefully they must verify with your bank that you do actually have a deposit. Especially if you’re completing the sale of a previous home on the same day.

Once the seller has moved out of the property, you can take possession of the keys from the estate agent. And only after that, you can move into your new property right away.

If you’ve been at the end of the chain, make sure to have a contingency plan in place and not hand over keys without an alternative home lined up. If you are one of those first-time buyers, it’s important to understand these things when signing your contract so that you don’t run into any issues with legality.

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Tory MP James Daly informed Greater Manchester Police (GMP) of claims made by neighbours that contradicted the Labour deputy leader's statement that her property, separate from her then-husband's, was her main residence.

Asked whether she should resign if she has broken the law, Sir Keir Starmer refused to say.

He told ITV: "She's given answers on the issue many, many times over, she's clearly said she'll co-operate with the police.

"I do think now is the time to let the police get on with their investigation, get on with the work they need to do, she'll co-operate with that which is exactly what you’d expect of her."

Angela Rayner is set to become the UK's deputy prime minister if Labour wins the next general election.

Here's what you need to know about the party's deputy leader - from her early life and career in politics to the abuse and controversy she has faced.

Born in Stockport in 1980, Ms Rayner was brought up on a council estate. She left school at 16 with no qualifications and pregnant with her first son.

She says she was told she would "never amount to anything".

"When I was young, we didn't have books because my mother couldn't read or write," Ms Rayner said in an interview with the Financial Times.

You can read more from Sky News below:

Over a year ago, Rishi Sunak made five pledges for voters to judge him on.

The prime minister met his promise to halve inflation by the end of 2023.

But with the general election approaching, how is Mr Sunak doing on delivering his other promises?

You can see the progress for yourself below:

The government should use TikTok to help combat misinformation directed at young people, a group of MPs has said.

Members of the cross-party Culture, Media and Sport Committee said ministers need to adapt to new apps and platforms that appeal to those who are increasingly turning away from traditional news sources.

The call comes despite the app being being banned from official electronic devices and the UK Parliament's network.

According to data from Ofcom, one in 10 people aged between 12 and 15 cite TikTok as their main source of news, while 71% of 16 to 24-year-olds use social media instead of or in addition to news websites.

The recommendation from MPs is part of a wider report published on Friday that calls for more use of "trusted voices" such as scientists and doctors to communicate important information and combat conspiracy theories and other misinformation spreading on social media.

Sir Keir Starmer is in Barrow-in-Furness today, where he was asked about the news police are investigating his Labour Party deputy Angela Rayner.

He said the police investigation will allow a "line to be drawn" on the issue of her council home.

The Labour leader said: "We welcome this investigation because it will allow a line to be drawn in relation to this matter.

"I am fully confident that Angela Rayner has not broken the rules. 

"She will cooperate with the investigation as you would expect and it is really a matter for the police."

People voting in local elections in England on 2 May will need to provide photo ID.

It is the second year the requirement has been in place - but in 2023,  14,000 people couldn't cast their ballot because they didn't take ID to the polling booth.

There are 22 different types of ID you can use - and if you don't have any of them, you can register for a Voter Authority Certificate.

Here's everything you need to know to avoid being caught out:

More reaction now to news that Greater Manchester Police are investigating Labour's deputy leader Angela Rayner.

The force is looking into claims Ms Rayner may have broken electoral law over information she gave about her living situation a decade ago.

London mayor Sadiq Khan has said he is fully confident one of his "best friends" will be cleared.

He said: "I fully support Angela Rayner, I'm confident that she'll be vindicated in relation to the police investigation.

"Of course there's an investigation now, which gives Angela a chance to explain to the police what went on."

Mr Khan added: "I'm fully confident in Angela, she's one of my best friends and I'm sure she'll be cleared."

More than 55,000 asylum seekers whose applications have been refused since 2011 may not have left the UK. 

The analysis of Home Office data doesn't include partners or children, so the number could be even higher. 

On the Daily, Niall Paterson speaks to our communities correspondent Becky Johnson about how delays in deporting failed applicants have led to some people being able to make multiple appeals - and in one case being in limbo in the UK for 18 years.

Plus, immigration lawyer Harjap Singh Bhangal talks about why so many appeals against deportation are successful. 

Prime Minister Rishi Sunak has hailed news that the UK economy has grown slightly for the second month in a row as "evidence" it has "turned a corner".

Gross domestic product (GDP) grew just 0.1% in February, the Office for National Statistics (ONS) said.

Mr Sunak said: "Today's GDP figures are further evidence that the economy has turned a corner, with growth in both January and February and the Bank of England forecasting growth to be higher than previously forecast in the long term. 

"Inflation is down from over 11% to 3.4%, wages are rising faster than prices, and unemployment remains low.

"This shows how important it is to stick to our economic plan and is why we are able to reward work and cut taxes for millions of people from this month. 

"Our long-term ambition is to abolish NICs entirely and end the unfairness of the double taxation of work."

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