Understanding Exchange and Completion When Buying a Property in the UK


Before you can exchange contracts, several critical tasks must be completed:

  1. Agreement on Price: Both buyer and seller must agree on the purchase price.
  2. Mortgage Approval: The buyer should have a formal mortgage offer and the deposit funds ready.
  3. Completion of Searches: The buyer’s solicitor must complete all necessary property searches.
  4. Set a Completion Date: A mutually agreed-upon date for completion must be set.
  5. Check the EPC: The Energy Performance Certificate (EPC) should be reviewed.
  6. Fixtures and Fittings Agreement: Items included in the sale should be confirmed.
  7. Building Insurance: The buyer should arrange building insurance to be in place by the time of exchange.

The Exchange of Contracts: Making the Deal Binding

What is the Exchange of Contracts?

This is the moment when the buyer and seller swap signed contracts, making the sale legally binding. Once contracts are exchanged, both parties are committed to the sale.

When Does Exchange Happen?

Typically, exchange happens 5-28 days before completion, with the average being around 10-14 days before the move.

What is an Exchange Deposit?

An exchange deposit is usually 10% of the purchase price, paid by the buyer as a sign of commitment. If the buyer backs out after the exchange, they forfeit this deposit.

How Long Does Exchange Take?

The exchange process itself can take a few hours. Each solicitor will read their client's contract aloud, confirm details, and then physically exchange the documents. The transfer of funds between solicitors may also take several hours.

Completing the Purchase: Finalizing the Sale

Setting the Completion Date

The completion date is when the buyer and seller agree that all funds will be transferred, and the sale is finalized. If you're in a long property chain, you might need to be flexible with this date. The availability of your removal company can also influence it.

What Happens on Completion Day?

On the day of completion, you may have to wait several hours for the funds to be fully transferred and for all transactions in the chain to complete. Once confirmed, your estate agent will give you the keys, and you can move into your new home.

Completion Checklist: Be Prepared

Ensure the following are ready for a smooth completion day:

  • Funds: Confirm that all funds are in place for the transaction.
  • Removal Company: Have your movers booked and ready.
  • Building Insurance: Ensure your insurance covers the new property.
  • Final Contract Check: Review the contracts one last time.
  • Key Collection: Know where and how to collect your keys.

For more tips on moving day preparation, check out these additional resources.

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Frequently Asked Questions

Can I Exchange and Complete on the Same Day?

While technically possible, exchanging and completing on the same day is rare. The complex financial, legal, and logistical processes usually require at least a 5-day gap between these stages.

Can I Change My Mind After Exchange?

If you decide to withdraw after exchanging contracts, you face severe consequences. As a buyer, you would breach the contract, allowing the seller to issue a 'Notice to Complete'—a 10-day period to finalize the sale. Failure to do so could result in the loss of your deposit and potential claims for compensation from the seller.

How Much Does It Cost to Exchange Contracts?

Typically, you need to pay a deposit of 10% of the purchase price when exchanging contracts. For first-time buyers, this might be lower, such as 5%. The cost of exchanging contracts is included in your conveyancing solicitor's overall fees.

Can I Exchange and Complete Without a Solicitor?

While not mandatory, handling the exchange and completion without a solicitor is impractical due to the complex legal requirements. It’s advisable to have a qualified solicitor manage these transactions.

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If you're looking to buy a property, reach out to your local Chewton Rose branch. Our experts can help you find the perfect home and guide you through the buying process.