What happens or needs to happen between exchange of contracts and completion?

[mumat39]

I've moved a few times and will hopefully be moving again, soon. We are in a longish chain and hoping to exchange next week, but won't be completing until September. :(

Anyway, I've never understood why exchange and completion don't happen on the same day and just wondered why it can't/doesn't. So what oes on in between? I think I'm nervous that someone could still pull out. Can they do that after exchange?

Many thanks in advance.

Sometimes it does happen on the same day. This is generally considered more stressful.
Up to exchange is the most stressful bit, as anybody can pull out at any time, after exchange if you pull out you forfeit the deposit (usually 10%) which is not an insignificant sum to lose.
Usually the gap between allows you to book removals, pack, sort out utilities/change of address etc knowing what the completion date is, it also allows for the draw down of funds from the bank for mortgages and to make sure that funds are all in the right place.
If exchange & completion happen on the same day all arrangements need to be made without certainty that everything will actually go ahead.

you can book removals before exchange on a provisional basis - but you really need a bit of a gap to confirm things, confirm post redirect and pack the last items.

you don't KNOW you are moving until exchange.

If you are actually living in the house you're selling and if exchange and completion happened on the same day, you'd have to pack in preparation for moving even though your buyer could cancel at any time up to exchange. So there you are surrounded by packed boxes and suddenly the move is cancelled and you're back to having people view. I had a buyer that let me down like that when we were expecting to exchange but we were moving out anyway so it wasn't such a problem. I think doing everything the same day is only practical if it's an empty house.

Although a buyer could pull out after exchange, I think they then lose their deposit, which is usually around 10% of the purchase price. That's £20K on a £200K house. Not many people are going to do that. My worst fear after exchange was not that they'd pull out but that something would happen to my house (empty) like a fire before the sale was completed.

The most important thing is to check that the solicitors have ordered the mortgage funds from the lenders, some need 7 days notice some need 48 hours. Find out how long your bank/building society needs and check the funds have been ordered.

Redirect your post.
Book removal van.
Speak to BT about your phone line and internet.

I've always been curious: I know buyers lose a deposit if they pull out after exchange; but do sellers have to pay anything?

Since a move isn't confirmed until exchange, the other thing you can do is all the admin: contacting utility companies, notifying everyone of change of address, changing phone companies, insurance, etc...

If you're ready to complete next week but you're not actually going to until Sept, the most likely explanation is that someone in your chain can't actually do it before then, because their mortgage isn't agreed for instance. Everyone in the chain needs to complete on the same day... Which takes a lot of co-ordination, when it's a long chain...

Ok, so there's quite alot to get done in between.

We are in a longish chain and I think everyone is hoping to exchange next week but with summer holidays it is likely to not complete for a few weeks. I didn't know that the completion date needed to be agreed at contract exchange. That's good as it gives us a date to work to.

Thanks for all your help. :)

I was wondering the same up until last week. Now that we've exchanged I can tell you that 3 weeks is not long between exchange and completion! My utilities take 2+ weeks to transfer so it may not even be done in time because I didn't get onto it straight away.
Basically, the gap is due to the fact that at exchange you need to fix a date for completion and up until exchange no one is sure that they're definitely moving.
GL

flow 4 - with regard to deposits on exchange the amount solicitors generally exchange on is 10% but you can agree to exchange on less so first time buyers at the bottom of the chain might exchange on whatever their deposit is say 5%. if you are in a chain the deposits will get passed up simultaneously.Right at the top of the chain there will be no deposit and I suspect the buyer would be able to sue for breach of contract and costs if completion failed to happen. I hope that makes sense.

I was explaining to DP this evening that the completion date will be decided on and forms part of the contracts at exchange. He was impressed with my knowledge. . I didn't tell him that I had consulted the oracle that is MN.

Thank you

39!
Thanks Always. As I thought, buyers without chains, like me, are at a disadvantage, since suing the vendors would be expensive, time-consuming and unpleasant.
Luckily things seem to be going well! :)

We are selling a property in England at the moment and we were asked if we would like to pay insurance to cover solicitors fees etc if the vendors back out.