What does exchange of contracts mean?

Exchange of contracts is one of the biggest milestones in the moving process.

It is the point where the transaction usually becomes legally binding.

Before exchange, the buyer or seller may still be able to pull out.

After exchange, both sides are legally committed to completing the sale on the agreed completion date. Pulling out after exchange can have serious financial and legal consequences.

What actually happens at exchange?

Despite the name, exchange does not usually mean you physically meet the other person and swap paperwork.

In most cases, the solicitors or conveyancers handle the exchange. The Law Society explains that solicitors may exchange by telephone using recognised formulae, after which each solicitor dates the contract, inserts the agreed completion date and sends the signed contract part to the other side.

What needs to happen before exchange?

Before exchange can happen, several things usually need to be ready.

These may include:

  • mortgage offer confirmed

  • searches received and reviewed

  • enquiries answered

  • contract reviewed

  • deposit arrangements confirmed

  • buildings insurance arranged if required

  • completion date agreed

  • signed documents returned

  • everyone in the chain ready

If there is a chain, exchange can only happen when everyone linked together is ready to exchange.

Guide: Moving house checklist

Why does exchange sometimes take longer than expected?

Exchange can be delayed by:

  • unanswered legal enquiries

  • mortgage offer delays

  • search delays

  • leasehold management information

  • survey issues

  • missing documents

  • slow responses in the chain

  • disagreement over the completion date

This is why exchange can feel frustrating. You may feel ready, but someone else in the chain may still be waiting for something.

What happens after exchange?

Once exchange has happened, the completion date is fixed.

You can usually move from “planning just in case” to “properly preparing to move”. This is often when people confirm removals, finish packing, redirect post, transfer utilities and prepare for moving day.

How Settli can help

Settli helps you track the steps leading up to exchange, so you can see what is complete, what is outstanding, and what questions still need answering.

It helps you keep all the moving pieces visible, rather than relying on memory during one of the most stressful stages of the process.

Stay on top of your move, from key tasks to awkward chasers.

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