There is no denying the excitement involved in exchanging contracts for a home. When you work with an experienced professional like estate agents in Winchester it is much easier and stress throughout the process. When you know you’re going to buy the property without a doubt, that is the point at which there is no turning back. The period before completion, or the time it really takes to move in, can change. Here is our explanation of what occurs prior to, during, and following the exchange of contracts, as well as how to get ready for the completion date.
Getting ready for a contract exchange
Only after all the monetary and legal requirements of the purchase are satisfied can contracts actually be prepared to be exchanged. Some of these include:
A purchase price has been agreed upon between the buyer and the seller.
The buyer has an official mortgage offer in place, along with deposit money.
The buyer’s attorney has finished all searches.
A date for completion has been set.
Checks have been made on the EPC (energy performance certificate).
The buyer and seller have agreed on the fixtures and fittings included in the deal.
Buildings insurance need to have been set up and in effect by the buyer.
Trade of contracts
What does the term “contract exchange” mean?
The exchange of contracts, which confirms the sale of the property, occurs when the buyer and seller swap signed documents. The sale becomes legally binding at this moment.
When does the contract swap happen?
Prior to completion, exchange typically occurs between 5 and 28 days, lasting on average 10 to 14 days.
What exactly is an exchange deposit used for?
The exchange deposit is the sum of money that the buyer pays to show that they are committed to moving forward with the transaction. It typically amounts to 10% of the purchase price and is nonrefundable. If the buyer backs out of the deal after the contracts have been exchanged, the seller is entitled to the exchange deposit.
What is the duration of exchange?
It could take many hours to complete the actual legal exchange process. Each attorney will read aloud the contract on behalf of their client before posting a copy online. The transfer of money from the buyer’s solicitor to the seller’s solicitor can take several hours.
The day that both the buyer and the seller agree will mark the transfer of all funds and the official confirmation of the sale is known as the completion date. How easy or difficult it will be to reach an agreement will be heavily influenced by how many properties are involved in the chain.
What happens when you finish?
On the day of completion, there is only waiting. It can take several anxious hours until the seller receives all of the purchasing monies and the transaction is complete. Your estate agent won’t confirm that you can pick up the keys and move into your new property until that time.
Checklist for completion
Make sure everything is prepared for completion day:
Ensure there are sufficient finances.
Is your moving company scheduled?
The property you are purchasing should now be covered by buildings insurance.
Verify the agreements one last time.
Do you know where the keys are kept?
Things you should know about the exchange of contracts
Can I finish and exchange tasks on the same day?
Although it is technically possible, it is not very common to exchange and complete on the same day. From a financial, legal, and logistical perspective, several things typically need to take place between exchange and completion, making doing both in 24 hours extremely unlikely. The majority of solicitors need a break of at least five days.
Can I revise my decision after exchanging?
You can, but there are serious drawbacks. You will be in breach of the contract if you, the buyer, cancel the transaction. The seller may reply by giving a “Notice to Complete,” which specifies a 10-day deadline for completion. The seller has the legal right to keep the deposit and sell the property to someone else if it doesn’t and the buyer is at fault. Additionally, they may demand restitution or damages.
How much does exchanging contracts cost?
You typically need to pay a 10% deposit of the agreed-upon asking price of the property in order to exchange contracts. If you are a first-time buyer and can only afford a 5% deposit, this amount might just be 5%. The exchange of contracts for a residence does not incur any additional fees. It will be included in the overall billed work for a conveyancing attorney.
Is it possible to swap and complete without a lawyer?
Again, you are under no obligation, but in practise, a competent solicitor is required in order to carry out the many legal procedures associated with purchasing a home.