5th February, 2019
Conveyancing: Time Between Exchange & Completion
Conveyancing can be a frustrating process, you may have questions such as “what is the time between exchange and completion?”
We aim to help you through this process and we look forward to helping you personally but here are some answers to frequently asked questions that may help in the meantime.
1. Very rarely is a transaction as straight forward as you think it should be
For most people, once they have had an offer accepted on the property of their dreams the next thing they want to do is to run down to IKEA/Marks & Spencer/John Lewis (delete as appropriate!) and start picking out furnishings. As far as buyers and sellers are concerned, one party wants to buy and one party wants to sell, what could be simpler?
The truth is that there is no set timetable when it comes to a conveyancing transaction and so things only progress as quickly as the slowest moving part of the chain. At times when banks are looking closely at their lending criteria it can often be the case that a buyer may have to jump through more hoops that previously in order to satisfy their chosen lender. Also, one person’s idea of urgent may not necessarily accord with another’s, and buyers and sellers can face dealing with people who may not share the same views on how quickly a transaction should proceed.
If there is a sizeable chain of transactions then it is possible that one transaction can be ready to proceed fairly quickly, but be delayed whilst transactions elsewhere in the chain deal with complications.
Because of this the best thing that buyers and sellers can do when they agree a sale is to not set their hearts on any specific dates. Hopefully all parties can work towards target dates but moving home is stressful enough without adding in the stress of trying to complete a transaction by a specific date, which may turn out to be unachievable. What this also means is that communication is key. When choosing a conveyancing solicitor make sure it is someone who is easy to get in touch with and someone who will keep you updated in a way that suits you.
2. Low Cost Conveyancing can be a false economy
There is a reason why moving home is commonly cited as one of the most stressful experiences that we can go through. The lack of any formal timetable for the steps involved in a conveyancing transaction and the reliance on all parties involved in the transaction to be proactive in order to ensure a swift a transaction as possible can lead to unforeseen delays and issues that buyers and sellers would not have considered when agreeing the sale.
The key to keeping this stress down to a minimum is to ensure that you have a good rapport with your Conveyancer and are able to speak to them directly to discuss the case and highlight any potential issues that might cause a delay as soon as possible.
If a buyer or seller chooses a Low Cost Conveyancer then they need to consider whether they will have the ability to speak to someone about there case. It is worth bearing in mind that in many cases Low Cost conveyancing services often publicised online mean that Conveyancers have to take on large numbers of clients and in many cases buyers or sellers can face dealing with a call centre type arrangement.
It is worth considering whether this is something that you want to deal with. In most cases finding a Conveyancer who will be able to speak directly to you is vital to ensure that communication is as clear as possible. Buyers and Sellers should be able to speak to the decision maker in respect of their transaction rather than someone simply reading notes off a screen.
3. Be upfront
One of the worst situations in a conveyancing transaction occurs when one party is not particularly upfront about their requirements at the outset of a transaction.
For example, a buyer might say they are a cash buyer when in fact all their funds are tied up in a property they need to sell, (yes, they won’t require a mortgage to buy the property, but they still need to sell their own first!), or a seller might not let on that they will need to defer completion for some time due to the requirement to find a rental property to move into.
If you are upfront about these requirements when you agree the sale then you will find that parties are more likely to accommodate any personal requirements. If you are not upfront at the beginning of the transaction and attempt to prolong proceedings to buy yourself more time then this can add to the frustration that many people feel during the Conveyancing process.
If you tell everyone what your position is at the outset of a transaction then the chain can plan for potential delays. If the delays crop up unforeseen during the transaction then this can lead to speculation as to why the delays have arisen. Speculation can only fuel feelings of frustration!
The conveyancing process will be stressful enough so it doesn’t help matters if buyer and seller start to consider themselves as being in opposition rather than working together.
4. There is no set time between exchange and completion.
Exchange of contracts is the process that makes the transaction legally binding. It confirms the parties to the transaction, the property being bought or sold, the agreed sale price and the date that the sale price will be paid to the Sellers, (known as the completion date). The time between exchange and completion will be whatever period of time the parties require in order to be able to get themselves ready for the completion date.
If you are a first time buyer currently living at home with parents and are not planning on moving into your new home straight away then it is entirely possible to exchange contracts and complete on the same day. If you are buying a new build property, which is not yet ready for habitation then it is possible to exchange contracts and complete months later once the property is ready. In most cases where people are selling one property and buying another the time between exchange and completion will be enough time to arrange removals and finances in time for the day that money and keys change hands.
It is worth making tentative enquiries with removal companies shortly before exchange to see what their availability is like. Once all parties have confirmed that they are ready to exchange contracts and make the deal legally binding you can confirm removal arrangements and fix completion for the earliest convenient date for all parties. If you are putting additional funds into a purchase then you will also need to give consideration as to how long it will take to get those funds cleared into your Solicitor or Conveyacer’s client account and ready to use.
It is worth mentioning again that until contracts are formally exchanged there is no fixed date for completion and so making these arrangements too early can lead to disappointment and maybe also cancellation fees interest if you have to cancel removal arrangements, which are made before contracts are exchanged.
5. Beware additional Leasehold Costs.
If you are selling a flat then it is likely that your Conveyancer will charge an additional fee to cover the extra work involved in the conveyance of a flat. However, it is also worthwhile bearing in mind that there are other fees that you may have to pay to the Freeholder of your building, which you may not have initial budgeted for.
When you sell a flat you will need to give to your buyers a pack of information relating to the service charges, ground rent, buildings insurance and usually confirmation of whether there are any major works planned to the building that might increase the service charge in the foreseeable future. Quite often the Freeholder will have a standard pack that provides all of this information. Either way they are likely to charge to provide the information to the Buyers.
It is usual practice for the Seller of a flat to pay for this information pack and the cost can vary from as little as £20 to in excess of £250.00. Sellers do not always realise that this cost will be payable, (particularly as most likely they didn’t pay it when they purchased the property), and may initially be reluctant to pay this cost as well. It is worthwhile noting that if a Seller refuses to pay this fee then the Buyer will have to pay it, which could lead to delays if both parties object to paying the fee.
Another cost that Sellers should check for is whether any transfer fees are payable. Some Leases will contain provisions that state that upon each sale of a property a fee equivalent to a percentage of the sale price be paid to the Freeholder. This fee could be anywhere from 0.1% or more of the sale price and depending on the value it is worthwhile checking your Deeds at the outset of the transaction to see whether such a fee is applicable to your sale. If it is then you will need to arrange to pay the same, (usually from the sale proceeds), and Sellers would need to budget accordingly.
The most important advice that we could give to a buyer or seller is to ensure that they instruct a Solicitor or Conveyancer who can be relied upon to provide clear updates at regular intervals, (at least once a week), and who is easily contactable.
Buyers and Sellers should be able to speak directly to the person responsible for progressing their transaction and resolving any delays without having to deal with administrative assistants who may only be able to read notes off a system. This may mean paying higher conveyancing fees but the benefit to clients will be feeling that they are in control over their own transaction and not subject to unknown factors that as buyers they may not understand or even be aware of.gravity_form(3, false, false, false, '', true, 12);
You might also be interested in...
9th August, 2022
Concerns surrounding the rising number of second homes has forced the Welsh Government to act. In July a... Read More »
2nd August, 2022
The Supreme Court has recently issued its long-awaited decision in the case of Harpur Trust v Brazel. This... Read More »