As a property transaction nears its end, you will hear two words again and again: exchange and completion. They are the two most important milestones in buying or selling a home in England and Wales, yet many people are unsure exactly what each one means or what happens on the day itself. Understanding the difference helps you plan your move, avoid costly mistakes and feel more in control. This guide explains both stages and what to expect on moving day.
What Is Exchange of Contracts?
Exchange of contracts is the moment the sale becomes legally binding. Before exchange, either the buyer or seller can withdraw without penalty. After exchange, both parties are committed to the transaction on the agreed terms.
Exchange usually happens by telephone between the solicitors involved. Each solicitor confirms that their client has signed the contract, and the agreed completion date is written in. The buyer’s solicitor sends the deposit to the seller’s solicitor, typically around 10% of the purchase price, although a lower amount can sometimes be agreed.
If a buyer pulls out after exchange, they are likely to lose their deposit and may face further claims. If a seller pulls out, they can also face legal action.
What Needs to Happen Before Exchange
Before exchanging, buyers need to have their mortgage offer in place, searches completed, surveys reviewed and any legal questions answered. Sellers need to have answered enquiries and agreed the contract terms. In a chain, everyone must be ready to exchange at the same time, which is why delays anywhere in the chain can hold everyone up.
Buyers of freehold properties with a mortgage usually need buildings insurance from exchange, because they become responsible for the property from that point.
What Is Completion?
Completion is the day the money is transferred and ownership officially passes from seller to buyer. It is also, in most cases, moving day.
The gap between exchange and completion varies. It can be a few weeks, a few days or even the same day, depending on what everyone in the chain agrees. Many people prefer at least a week or two so they can book removals with confidence.
What Happens on Completion Day
On completion day, the buyer’s solicitor sends the remaining purchase money to the seller’s solicitor. In a chain, funds pass from one solicitor to the next, so completion can take several hours.
Once the seller’s solicitor confirms the money has arrived, they tell the estate agent, who can then release the keys to the buyer. Completion often happens around midday or early afternoon, but it can be later in long chains.
Sellers are usually expected to vacate the property by an agreed time, often around midday, so make sure your removal company knows the plan.
Tips for a Smooth Moving Day
- Book removals as soon as you exchange and the date is confirmed
- Pack in advance and label boxes by room
- Keep an essentials box with kettle, mugs, chargers, toiletries and key documents
- Take meter readings at both properties
- Leave instructions for appliances and the heating system for the buyer
- Be patient, as completion can be delayed by bank transfers in the chain
If You Are Renting Before You Buy
If you currently rent, timing your notice is important. In England, most private tenancies now roll on periodically, and tenants usually need to give two months’ notice to end them. Giving notice too early could leave you without somewhere to live if your purchase is delayed. Giving it too late could mean paying rent and a mortgage at the same time.
Many buyers wait until exchange, when the completion date is fixed, before giving notice, and then budget for a short overlap. Talk to your letting agent about your options, as some landlords may agree to flexible end dates.
If You Are a Landlord Selling a Let Property
If you are selling a rental property, make sure the tenancy position is clear before exchange. The buyer needs to know whether they are buying with tenants in place or with vacant possession, and any deposit must be transferred or returned correctly.
After Completion
After completion, the buyer’s solicitor pays any Stamp Duty due and registers the new ownership with HM Land Registry. The seller’s solicitor repays the seller’s mortgage and sends any remaining funds to the seller.
Final Thoughts
Knowing the difference between exchange and completion helps you plan each step of your move with confidence. If you are renting while you buy, or letting a property as part of your move, speak to Letting agents in Hatfield who can help you time your notice, manage your tenancy and make your move as smooth as possible.