What exactly is exchange and completion?

monty-doggy

Thank you

InMyDreams

puregeordie wrote: »

just a q about this,

from exchange to completion what happens to your mortgage balance?

Nothing.

puregeordie wrote: »

is this adjusted accordingly at completion as your still paying your mortgage until completion which could be a few months. So I take it whatever is left your obviously just pay that balance off.

Nothing happens to the mortgage until completion. On the day of completion (or maybe the day before to ensure funds are in place) the funds are drawn and on the day of completion (together with your deposit which the solicitor will have been holding) they are paid to the vendor and that's when the interest starts to be calculated. Not at exchange.

arbrighton

Think puregeordie is asking from a vendor's perspective? Clarify please

welshwizard1927

Is there any reason why parties wouldn't want exchange and completion on the same day? Subject to having sight of the contract in draft form, I'm a bit unclear why you would want a delay?

SpottyWellies

welshwizard1927 wrote: »

Is there any reason why parties wouldn't want exchange and completion on the same day? Subject to having sight of the contract in draft form, I'm a bit unclear why you would want a delay?

Many people do plan exchange and completion for the same day but bear in mind one big downfall about doing things the same day is that people can pull out right up to the second before exchange is done for a multitude of reasons, if you are planning on completing on the same day that means your removals will be booked, utilities cancelled etc..

What if just before exchange one party pulls out and your life is in the process of being loaded onto a removals lorry?

When exchange happens you pretty much know the house is all yours in all bar dotting of the i's and t's! You can then confirm removals schools and other such things.

That is my understanding anyway as to why one/some of the reasons that people advise against it.

eddtheduck

Because you will need to arrange a removal firm - the completion date is set at the time of exchange, giving you a date for removal. If you are in a chain (ie selling one house and buying another) you may have to vacate the first house in the morning and move everything into your new house in the afternoon.

lessonlearned

welshwizard1927 wrote: »

Is there any reason why parties wouldn't want exchange and completion on the same day? Subject to having sight of the contract in draft form, I'm a bit unclear why you would want a delay?

To organise removal vans, arrange utiilties etc.

However the biggie here is that until exchange takes place your sale/purchase is not safe. It can all go horribly wrong. It is only at exchange that is becomes legal and binding.

DGJsaver

How does all this work , if you have accepted an offer on your house , and have swopped solicitor details , but havent found anywhere to live , where does the process `stall` , for want of a better term....?

dzug1

The process stalls when you don't exchange contracts because you can't commit to the sale

SpottyWellies

DGJsaver wrote: »

How does all this work , if you have accepted an offer on your house , and have swopped solicitor details , but havent found anywhere to live , where does the process `stall` , for want of a better term....?

If you have accepted an offer on your house, you either need to find a house you want to buy and have an offer accepted on it or plan to make other arrangements such as moving into rented.

You become a link in the chain.