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What’s the difference between exchange and completion when buying a home?

Kim Staples
Written by  Kim Staples
Jonathan Leggett
Reviewed by  Jonathan Leggett
5 min read
Updated: 07 May 2024

The final stages of buying a property are the exchange and completion – at which point the house is officially yours. Here’s what those stages mean, and what you can expect from the process.

What does exchange mean when buying a house?

The term ‘exchange’ in a house purchase refers to the exchange of contracts between the buyers’ and sellers’ solicitors. At this point, the sale is legally binding. The buyer is obliged to buy, and the seller is obliged to sell and abide by the conditions in the contracts.

Both the buyer and seller are able to pull out of the sale at any point before the exchange – but if they do so afterwards, there are steep penalties. As a buyer, you’d lose your deposit.

What happens when you exchange?

You don’t need to be present for the exchange – it’s handled by your solicitors or conveyancers.

The two sets of solicitors will read out their contracts in a recorded conversation, usually over the phone, ensuring that both the buyers’ and sellers’ contracts are the same. If all parties are happy, it’s signed off, and the solicitors post the contracts to each other.

At this point, you as the buyer will need to:

  • Pay the deposit to the seller

  • Be available for a quick phone call with your solicitor to confirm you’re happy to exchange that day – everyone making the purchase will need to do this

  • Get buildings insurance for your property starting from this date

What does completion mean when buying a house?

Completing means you have officially bought your property. The purchase is legally finalised, money is sent, and ownership is transferred to you.

If you’re part of a chain, all properties will ideally complete on the same day. The date is usually set in advance to suit everyone.

What happens when you complete?

All purchase monies are transferred at this point, including the mortgage. Your solicitor will also send a letter of completion to confirm everything.

This is the day you can collect the keys and access your new home. The purchased property must be vacant and available for your possession by 1pm that day.

If you’re not a first-time buyer, and are also selling your home, this is the day you’ll need to move out of your sold home and into your newly purchased one.

What’s the difference between exchange and completion?

Exchange is the point at which the sale is legally binding, and neither the buyer nor seller can pull out without hefty penalties. It’s basically the last stage of the purchase before the actual sale goes ahead.

Completion is then the very last stage of all. The property passes to its new owner, you have access to your new home, and everything is finalised. At completion, you’ve officially bought your house.

How long does it take between exchange and completion?

The usual time between exchange and completion is one to two weeks. But it can vary depending on your situation.

For very simple purchases with no chain, it can be short – sometimes even the same day.

On the other hand, if there’s a much longer chain to organise, the time between can be up to four weeks. This allows everyone to make their moving arrangements at a time that suits them.

What happens between exchange and completion?

There are a few tasks to be done between exchange and completion, mostly by your conveyancers/solicitors:

  • Both sets of solicitors run some final checks – the buyers’ solicitors make sure the property is still available in the same condition, and the sellers’ solicitors make sure the buyers’ finances haven’t had any serious changes (such as bankruptcy)

  • Your solicitor registers the transfer of ownership with the Land Registry

  • If the property is leasehold, the solicitors inform the freeholder of the new owner – or if it’s a share of a freehold, they arrange for a certificate

  • You pay your solicitors’ final bill, which includes the mortgage, arranged by your mortgage provider

In some cases, buyers are also allowed to start building works on their new property at this stage. Many contracts have a clause for ‘key undertakings’, which normally allow for works that need to be done before you can move in (for instance, major renovations or fixing anything notably dangerous). This would be discussed beforehand.

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