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Buying a Property | How Do I Exchange Contracts?

Miller Metcalfe posted on 7th August 2018

If you’re in the process of buying a home, it’s essential to understand what happens during the exchange, from paying your deposit to signing legal documents. Being prepared can help ensure a smooth transaction and avoid any last-minute delays.

At Miller Metcalfe, our experienced estate agents and property experts are here to guide you every step of the way. If you need advice on navigating the exchange of contracts process, get in touch today to make your move stress-free.

Understanding the Exchange of Contracts Process

The last (legal) stage of your property journey is the exchange of contracts. Once this has started, you cannot pull out (without losing your legal costs and deposit)

Once your offer has been accepted on a property and all of the necessary checks have been completed, you will be asked to pay a deposit on the property. The deposit is usually 10% of the property value (sometimes 5%). You will be required to pay the deposit on the property before the contracts can be exchanged.

You pay your deposit to your solicitor (or conveyancer) along with any other costs you have incurred such as stamp duty. As well as this, you will need to sign all the necessary legal contracts and documents provided to you.

IMPORTANT: It has become common for scammers to intercept emails between solicitors and buyers, providing you with the wrong bank details for your deposit transfer. Please remember to check bank details with your solicitor directly to avoid any loss.

Both yourself (the buyer), and the current owner of the property (the seller), will be required to sign the contracts. Once signed, they will need to be sent, via recorded delivery, back to your solicitor/conveyancer. You will then be notified when these have been received.

At this stage, it is important to get your buildings insurance in place ready for the contracts being processed. It may also be useful to consider other protection at this point such as life insurance. Speak to one of our protection advisors at any time, simply visit our financial services page for more information.

You will then be issued with your date of completion. This is usually around 2 weeks after the contracts have been processed, although sometimes this can be quicker. It is important to use this time to plan your move and get all of your items in check.

Exchanging Contracts as First-Time Buyers

Do I need a mortgage offer before exchanging contracts?

Yes, you should have a formal mortgage offer before exchanging contracts to avoid any financial risk.

What happens if my mortgage offer expires before completion?

You’ll need to apply for an extension or a new offer, which could delay completion. Always check your mortgage offer’s expiry date before exchanging contracts.

Who arranges the exchange of contracts?

Your conveyancer or solicitor handles the exchange, ensuring all legal checks are completed before committing to the contract.

Is exchanging contracts the same as completion?

No, exchange of contracts makes the deal legally binding, while completion is when the property ownership transfers, and you can move in.

Can I exchange contracts without a deposit?

Typically, you need to pay a deposit (usually 5-10% of the purchase price) upon exchange. However, some lenders or schemes may allow for a lower deposit arrangement.

Exchanging Contracts as Buyers in a Property Chain

What happens if someone in the chain delays exchanging contracts?

If one buyer or seller in the chain faces delays (for example, mortgage issues or surveys), the whole chain may be delayed. Your solicitor will keep you informed.

How can I speed up the exchange process in a chain?

Ensure all your documents are in order.
Respond quickly to solicitor queries.
Confirm your mortgage and deposit are ready.
Stay in communication with your estate agent and solicitor.

What if a buyer or seller in the chain pulls out?

If someone pulls out before exchange, the entire chain can collapse unless a replacement buyer/seller is found quickly. Some buyers use chain-break loans to continue.

How long does it take to exchange contracts in a property chain?

It varies but can take 6-12 weeks on average, depending on how many buyers and sellers are involved.

Exchanging Contracts as Chain-Free Buyers (Cash Buyers & New Builds)

Do cash buyers exchange contracts faster?

Yes, without mortgage applications and lender checks, cash buyers can exchange contracts much quicker – sometimes within a few days to a couple of weeks.

Can I exchange contracts and complete on the same day?

Yes, if both parties agree and all legal work is done, same-day exchange and completion can happen, but it’s less common.

How long does it take to exchange contracts on a new build home?

Developers often require buyers to exchange contracts within 28 days of reserving the property, even if the build isn’t complete.

Is a survey necessary if I’m buying a new build?

While not required, a snagging survey can identify minor defects before completion.

Preparing to Buy? Here’s How We Can Help

Exchanging contracts is a crucial step in securing your new home, whether you’re a first-time buyer, navigating a property chain, or purchasing chain-free. Understanding the process ensures a smoother transition to completion and minimises potential delays.

At Miller Metcalfe, our experienced estate agents are here to support you throughout your property journey. If you need expert guidance on buying a home and exchanging contracts with confidence, get in touch today to make your move stress-free.

Miller Metcalfe

Miller Metcalfe are approachable, friendly and committed to making your move as quick, simple and stress free as possible – just what every estate agent should be!

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