How long between exchange and completion?
The time it takes to move from exchange to completion is usually 1-2 weeks but it can happen faster or last longer, especially if both parties need more time to organize themselves for the competition.
In this article, we’ll explain what exchange and completion are, whether there is a maximum time between exchange and completion in the UK, and what you can do to speed up the process.
Let’s dive in.
An exchange of contracts is when two solicitors, representing the buyer and the seller, meet and swap signed contracts for the property. At this point, the contract becomes legally binding, and they can no longer back out of the deal without penalties.
Exchanges can take place over the phone as well. In this case, both solicitors read out the contract and send the documents to one another.
When contracts are exchanged, the buyer has to put down a deposit to the seller, usually around 10% of the property’s value, to signal that they are serious about the purchase. If 10% is too much, your conveyancer should be able to negotiate a lower deposit amount.
Did you know? Both buyers and sellers have conveyancers who are in charge of transferring ownership from one person to another. They usually change £850 to £2,000 for overseeing the entire process.
Completion is the final step of the property transaction, where the seller officially transfers full ownership of the property to the buyer.
It takes place when the seller’s solicitor confirms they’ve received the full purchase monies.
Usually, sales are completed on a Friday, so the new owner has the entire weekend to settle in the new property. The buyer is usually given vacant possession by 1 p.m. unless the parties have a different agreement.
Should any issues arise, you’ll likely have to wait until Monday to resolve them, given that banks don’t usually work during weekends. The good news is your conveyancers will deal with them.
You may be interested in: What is the difference between conveyancer and solicitor?
The average time between exchange and completion is 1-2 weeks, and sometimes longer. The completion date is set during the exchange, which means you can choose when you want it done.
Here are some of your options:
A fast exchange to completion time of less than a week is the best option for a no-chain and vacant property. Since the seller doesn’t need any extra time to pack and move out, this option has few downsides other than it may take your mortgage lender more than 3 days to send your conveyancer the funds.
Opting for a 3-day exchange-completion time is not a good idea if you live in a rental since your landlord will require you to hand in a notice, which means you’ll have to pay rent for a place where you no longer live.
This is the ideal time between exchange and completion, as it gives both parties space to organize their documents, like building insurance and draw down a mortgage. It’s also more suitable for property chains where more parties are involved.
Leaving a long gap between exchange and completion is typical for first-time buyers who are looking to tie the rental notice period with their exchange. Another advantage is that this agreement gives both the seller and the buyer plenty of time to prepare for completion.
Conducting an exchange of contracts without settling a completion date is typical for buyers who are investing in a new build. They have 28 days to exchange contracts once they reserve the property, but there is no set maximum time between exchange and completion for a new build.
The seller will give you an approximate time when the building will be complete, but the final date can be delayed.
A same-day exchange of contracts to completion is possible, but it comes with plenty of logistical issues.
Doing exchange and completion on the same day means you might not receive the necessary paperwork on time, your mortgage lender might not be able to send you the funds you need for the property, and the seller might not have enough time to pack and leave the property in a reasonable condition.
There’s also the risk that you miss something, given that you have plenty on your hands and only 24 hours to finish everything.
In a best-case scenario, exchange and completion on the same day is feasible with a cash buyer and buy-to-let investors who are willing to let an existing tenant stay on the property for a certain period of time.
It is possible to start doing building work after the exchange of contracts by signing a legal agreement known as ‘Key Undertaking’.
This is a legal document issued by a conveyancing lawyer which gives the buyer access to the property between exchange and completion, in which the buyer agrees to compensation for any damages that might occur during refurbishment. (Here’s everything you need to know about underpinning a house).
The frustrating part about the entire process is that the delays that take place are often unexpected and out of anyone’s control. Here’s what you can do to speed things up:
Exchange of contracts is the process in which both the buyer and the seller commit to the deal, and completion is the final point of the transfer, where the buyer officially becomes the new owner of the property.
The average time between exchange and completion is 1-2 weeks, but it can be shorter or longer, depending on the agreement between the buyer and the seller.
The buyer and the seller agree to a completion date when the exchange of contracts happens. It cannot be decided by one party alone.
It’s possible for a no chain and vacant property and any situation where the seller isn’t tied to the property they’re selling and the buyer doesn’t need to tie their rent agreement or mortgage funds for completion.
Completion day is the date when the seller’s conveyancer confirms that they have received the money from the buyer. Once the money is transferred to the seller’s account, the buyer can collect the keys and move into the new property.
There’s no maximum time between exchange and completion. The parties involved can agree to a date that suits both of their schedules. Anything that pushes the deadline is considered a delayed completion.
It can take anywhere between 1 day and a couple of months. The average time between exchange and completion is 1-2 weeks.
My name is Marija, and I'm a financial writer at DontDisappointMe. Although finance might not be everyone's cup of tea, my 10+ years of working in one of the biggest banks in my country, and my interest in extensive research on everything finance/investment-related, have made me somewhat of an expert in the field (if I do say so myself). No longer having the passion to work in a corporate setting, I decided that I couldn't let all of this knowledge go to waste so I started writing. And, here I am! Today I try to share my knowledge with my audience in the hopes of making this topic as simple and interesting as possible. In my leisure time, I like spending time with my family and travelling to new locations.