Why is there a gap between exchange and completion?

There is a gap between exchange and completion because of logistics and the conveyancing process itself. Right up until exchange, either the buyer or seller could pull out from the transaction, which would mean if you had been busy packing your stuff into boxes, you'd need to start unpacking again; you have another 3 to 6 months of house hunting and the conveyancing process all over again. The gap between exchange and completion can be reduced if: The property is vacant You are using removal companies for packing You are a cash buyer

What happens if stamp duty changes between exchange and completion?

Stamp Duty Land Tax is payable at the prevailing rate on the day of completion, which means if the SDLT changes up or down between exchange or completion, then you pay the new rate. Stamp Duty Land Tax, where rates change to cost you more tax, are normally budgeted for in advance, so the change is known before you exchange contracts. One of the largest changes was the implementation of the second home stamp duty for additional homeowners that was effective from the 1st April 2016 and this was known after it was stated in the November budget. Whereas, with SDLT changes where there are potential savings, such as the SDLT relief in the September mini-budget in 2022, the stamp duty relief took immediate effect. For anyone who has already exchanged, you will pay the new lower rate of SDLT upon completion. What does HMRC say? SDLTM08100 - Scope: When is Stamp Duty Land Tax (SDLT) chargeable Completion means completion of the land transaction proposed, between the same parties, in substantial conformity with the contract. Source: SDLT Manual 08100

You might think all the work is done by exchange, however, here is a complete run through on what happens between exchange and completion and who needs to do what and when.

What happens between exchange and completion?

by:

Andrew Boast

Last Updated: 07/11/2024

Read by:

3,193

5 min read

What happens between exchange and completion depends on who you are in the chain. The seller, buyer and their respective solicitors all have jobs to do that need to be finalised before completion. We have a to-do list for everyone involved so you know what everyone needs to do.

In this article

What should I be doing between exchange and completion?

Buyer

Take out buildings insurance between exchange and completion (required for all freeholds from exchange).
Hand in your notice to your landlord. Read more on - When do I hand in my notice?.
Confirm completion date with your removals company.
Send your completion money to your solicitor the day before completion.
Organise a redirection for your post through Royal Mail.

Seller

Pack up possessions in property, ready to move out.
Organise Royal Mail postal redirection for the date of completion.
Release keys to selling agent or the buyer once confirmed by the seller's solicitor.
Vacate the property and leave it empty on completion. Read more - Seller left personal property in house - what can you legally do?
Take utility meter readings and give to providers.

Solicitor final checks before exchange

The buyer's solicitor will review the source of funds, contracts, title documents and property searches. They will also raise the legal enquiries and write a report on the title of the property.

The seller's solicitor will draft contracts and respond to enquiries. If needed, they will carry out the necessary investigations to try and satisfy those enquiries.

What happens between exchange and completion solicitors?

Buyer's Solicitor

Send executed contract of exchange and 10% deposit to the seller's solicitor.
Send the Certificate of Title to the mortgage lender to drawdown mortgage funds the day before completion.
Draft completion statement and send to buyer. Read more - What is in a purchase completion statement?
Send completion monies to seller's solicitor.
Confirm once completion has taken place and keys have been released.
Pay SDLT, register property at Land Registry. Read more about - What happens after you complete?

Seller's Solicitor

Receive 10% deposit from buyer's solicitor.
Send Replies to Requisitions to buyer's solicitor.
Request mortgage redemption statements from mortgage lender/s
(if leasehold) Request up to date service charge and ground rent statements and send completion statement to buyer's solicitor.
Draft completion statement and send to seller.
Receive completion monies and pay off any mortgages.
Call the buyer's solicitor or estate agent to release the keys.

How long can the gap be between exchange and completion?

The standard time between exchange and completion is usually 2 weeks. The issue is when you're buying a new build property, as you will be exchanging contracts within 28 days of reserving it, and it can take months to completion.

The timeline will be agreed upon by the parties involved in the transaction on a case-by-case basis. You will find that the shortest time between exchange and completion can be the day of completion or 3 days before, although this might not always be suited. The maximum time between exchange and completion can be a couple of months. We explain the timeline in more detail in our article - How Long Between Exchange and Completion?.

Can things go wrong between exchange and completion?

Once contracts are exchanged, you are legally bound to complete the transaction, which means you can't pull out of the transaction after this stage without incurring financial costs. However, some issues may still arise in the process.

Completion day can be delayed
Property defects may be discovered
Mortgage issues, such as the mortgage offer being withdrwan

What if the buyer wants access before completion?

This poses risks to both sides, read our guide before giving the buyer access before completion.

Exchange of Contracts

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Completion Day Checklist

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Pre-Exchange Checklist

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GAP

SDLT

Written by: Andrew Boast

Andrew started his career in 2000 working within conveyancing solicitor firms and grew hands-on knowledge of a wide variety of conveyancing challenges and solutions. After helping in excess of 50,000 clients in his career, he uses all this experience within his article writing for SAM, mainstream media and his self published book How to Buy a House Without Killing Anyone.

Reviewed by: Caragh Bailey

Caragh is an excellent writer and copy editor of books, news articles and editorials. She has written extensively for SAM for a variety of conveyancing, survey, property law and mortgage-related articles.