It’s exciting to think about moving into your new property once a seller accepts your offer. It’s the beginning of a new chapter in your life, and you’ll be looking forward to the memories you’ll be making with your new pad. However, it’s not a guaranteed deal until you’ve exchanged contracts and completed the conveyancing process. In this guide, we’ll explore the intricacies involved in these complicated finalising steps.
What Is the Exchange of Contracts?
Exchange of contracts is the point in the conveyancing process wherein two legal parties that represent the buyer and seller swap legal documents. The buyer will also pay a deposit in this transaction. After this step, the agreement will be legally binding, which means neither party can back out of a deal without paying penalties that come with the cancellation.
What Does the Process Entail?
In the past, the exchange of contracts occurred when solicitors and licenced conveyancers met up physically and swapped contracts. However, the whole process takes place over the phone nowadays.
The legal representatives have to review the details of the contract and have to verbally agree on the terms, conditions, and completion date. They will also have to confirm that they possess all required documents and payments involved in the transfer of the property.
The conveyancer will need to contact the people in charge of the process on the day of exchange. Here, they need to confirm if the signed contract of sale and deposit funds have indeed been received, as well as the terms of sale and completion. Keep in mind that all these will go through a chain of people, sending confirmations back and forth.
The next legal representative in line will be given a schedule of release time, which allows them enough time to check and confirm the exchange. The conveyancer will then contact the seller’s representative for further confirmation until all documents are deemed correct for exchange and completion.
Each solicitor or conveyancer in the chain must agree and verify all details in the contracts. Once this is all done, the exchange is completed.
How Long Does the Exchange Process Take?
As previously mentioned, the process will go through a chain of solicitors. How long the exchange and completion process will take approximately will depend on the number of people involved.
If it’s a direct transfer from one seller to the buyer, the process likely won’t take long. However, if several parties are involved—including legal companies and mortgage lenders—the process can take nearly the entire day.
There are also other factors that need to be considered, such as the availability for calls, the state of documents, how prepared you are for the move, and so on. Simply put, it will depend on every person involved in the process.
Speeding up the Exchange and Completion Process: What Will It Take?
For the exchange process to move as quickly as possible, all parties involved should take action and respond to requests immediately. Slow seller or buyer responses will inevitably lead to delays, and the same goes with solicitors and conveyancers.
Communication must be clear among all parties at all times during the process. The buyer should keep in contact with their legal representatives and mortgage brokers. The sellers must also stay in touch with the conveyancers and real estate agents to ensure smooth procedures and prevent unnecessary delays.
As much as possible, it’s best to agree on an exchange and completion date in advance so that everyone is on the same page and will have to work towards the same goal. By doing so, all parties can avoid unexpected holidays and days off.
What Do Buyers Need to Prepare for the Exchange?
Preparing for an exchange of contracts entails guidance and attention to detail. Keep in mind that you will need the proper legal and financial advice, as documentation will need to be appropriately signed. More importantly, your money must end up in the right hands.
As a buyer, you need to consider the following items:
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The accurate amount of your deposit fees, which your chosen legal company should clear
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Your signature on the contract of sale
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Your signature on the deed of transfer of title, which the seller should also sign
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Your property insurance policy
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The agreed-upon completion date
That said, your conveyancer must be prepared by:
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Having the signed deed of transfer and contract
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Ensuring that any irregularities regarding the property and process have been resolved
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Holding legally cleared deposit funds, property insurance policies, and all paperwork relating to the property
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Having survey for concerns that need to be addressed
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Being in possession of your mortgage lender’s offer and confirmation, which should state that the funds will be ready by the completion date
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Preparing a completion statement detailing the fees you need to or have already paid for.
Some Helpful Tips for Buyers
The exchange and completion process can be difficult and daunting, but it doesn’t have to be. Here are some tips to help you:
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Ensure that your conveyancer is ready with your details and paperwork, which should help you ensure that the property falls into your hands.
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Study the process carefully, and should it prove difficult, ask your conveyancer for help. They could provide you with a document outlining the process, which should lead up to the tentative completion date.
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Gather all the documents needed for completing the process, which should include loan cheques and cover searches.
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Make sure to work only with a trusted mortgage company, where you can get comprehensive interest rates and accessible deposit funds.
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Don’t be unreachable—you need to have your phone with you at all times. That said, this also means avoiding holidays and vacation plans until the completion of your transaction.
What Do Sellers Need to Prepare for the Exchange?
Sellers do not need to do much in the exchange transaction because the buyer will shoulder the bulk of the work. However, they can help speed up the process by:
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Agreeing on an exchange and completion date
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Ensuring that all contracts and transfer of title documents are completed and signed
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Responding to all enquiries that the buyer may have.
The seller’s conveyancer also has some duties. They must:
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Have the seller’s signed contract and transfer of title document
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Prepare an estimate of mortgage redemption costs
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Ensure that the buyer’s legal company has prepared the deposit funds.
Some Helpful Tips for Sellers
Sellers can reduce the stress out of the conveyancing process by following these tips:
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Understand the whole conveyancing process.
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Collect all receipts and warranties for the work you’ve done for the property, such as renovations, home improvements, and building regulations.
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Hire a conveyancer before even having an offer, and choose one for the quality of their services.
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Complete all forms and documents on time.
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Be easy to contact during the process.
The Takeaway
The exchange and completion make up the final stages of the conveyancing process, and they can be quite confusing to navigate. If done incorrectly, the transfer of the property will suffer from unexpected delays. By using this article as a guide, you will hopefully have a better understanding of the transactions involved and ensure that everything goes as smoothly as possible.
Experts and digital tools can also help you through the process. If you’re looking for conveyancing quotes in the UK, Conveyancing Calculator has you covered. We have an online conveyancing calculator that can give you the best and most accurate prices in the market. See for yourself—get a quote today!
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