Mortgage Exchange and Completion

Mortgage exchange and completion when buying a home.

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 is legally binding, so be certain you want to go ahead before signing anything. Use our helpful checklist to make sure you have not missed a step:

• Check the searches are complete.
• Make sure you have your mortgage offer in writing.
• Check you have the funds for your mortgage deposit.
• Make sure you have 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 do not understand.
• Keep in regular contact to prevent any hold-ups in processing the paperwork.
• Make sure you know what is 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.

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. These rate 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 is valid from your exchange date.

Exchanging contracts

During the exchange of contracts, the solicitor or conveyancer will normally 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 are legally bound to buy the property to:

• tell the freeholder (if it is a leasehold property) you are the new owner.
• check the solicitor/conveyancer has registered transfer of ownership with the land registry.

If it is a share of freehold purchase, the solicitor will arrange for a new share certificate to be issued.

Completion date

This is the date when you can 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.

Tips for preparing to move

Organise post forwarding. Notify everyone you have 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.

We have more guides available for first time buyers, home buyers, remortgages and buy to let.

We also recommend The Money Advice Service if you want more detailed information.