Exchange and completion explained

General guidance, not a personal recommendation. Lender criteria, insurance terms and costs depend on the product and your circumstances. Numerical examples are illustrations unless expressly identified as an individual quote. Check current terms with your adviser and tax or legal points with the relevant specialist.

Exchange of contracts is the moment the deal becomes legally binding. Both buyer and seller sign the contract; neither can back out without serious financial penalty. Your deposit becomes non-refundable. A completion date is set.

Completion is the day ownership transfers. Your solicitor sends the balance of the purchase price to the seller's solicitor. Keys are handed over. You move in. Typically 7-28 days after exchange, though some people exchange and complete on the same day.

What happens at exchange

Exchange is handled by your solicitor (conveyancer), not you. By the time exchange happens, they've already:

• Completed searches (local authority, environmental, water & drainage).
• Reviewed the seller's title deeds and raised any enquiries.
• Reviewed your mortgage offer and confirmed funds.
• Agreed the contract wording with the seller's solicitor.

On the day of exchange:

1. Both solicitors confirm their clients have signed.
2. Your deposit (usually 10% of purchase price, though can be less) is transferred to the seller's solicitor.
3. Contracts are formally exchanged by phone between the two solicitors (there's a standard legal wording used).
4. Completion date is fixed, can't be changed except by mutual agreement.

From this moment, the property is "sold subject to contract" changes to "sold." If you pull out after exchange, you lose your deposit and can be sued for further losses. If the seller pulls out, they owe you your deposit back plus potential damages.

What happens in the gap

Arrange buildings insurance

From the moment you exchange, the property is your responsibility. You need buildings insurance in place from exchange day, not completion. If the house burns down between exchange and completion, you still have to buy it.

Finalise mortgage funds

Your solicitor requests the mortgage funds from your lender (usually 3-5 days before completion). Lender sends the money to solicitor, who holds it in client account ready for completion day.

Pay the balance

You transfer the balance of your deposit to your solicitor, typically 2-3 working days before completion. They'll email you exact figures (the Completion Statement).

Book removals

Only book confirmed movers after exchange. Usually £300-£1,200 depending on distance and volume. Busy Fridays and end-of-month are most expensive.

Set up utilities

Contact utility providers with the completion date so they're ready from day one. Read meters on the day you move in and submit them. Set up council tax.

Prepare for the day

Confirm removal time, make sure someone can be at the new property when you arrive to receive keys (usually from around 1-2pm on completion day, but varies).

Completion day itself

Completion is the day you own the property. Timings:

• Morning. Your solicitor sends the balance of purchase price to the seller's solicitor (usually by CHAPS, same-day transfer).
• Midday/early afternoon. Seller's solicitor confirms receipt. The seller's solicitor releases the keys (usually lodged with the estate agent) and notifies your solicitor.
• You. Estate agent calls you: "the keys are ready." You collect, open the door of your new home.

A few days later, your solicitor will complete:

• Stamp Duty Land Tax, submitted to HMRC and paid. Your solicitor handles this.
• Land Registry registration, the title is transferred into your name. Can take a few weeks to be updated on the Land Registry.

After that, you'll get confirmation of registration and the official title documents (now usually held electronically).