Same day Exchange & Completion

Jamesdobo

Hi Everyone, 
I have seen various posts which suggest same day exchange and completion is risky. 
For my situation, i cant help but think it is the least risky option, so much so i am hesitant to go ahead with the transaction unless exchange and completion happens on the same day. 

I am a first time buyer, hoping to purchase a property using HTB. The reasons for me wanting to exchange and complete on the same day is to negate any  risk of the mortgage being withdrawn after exchange. The property in question is vacant, and i am currently living with parents so no issues with regard to chains. 

Is there anything else i am missing with regards to the 'Cons' of exchanging and completing on the same day. 

Your responses are much appreciated. 

Many thanks.

Seashell517

If you're using HTB, then the property is the new build? If so, the builders will want exchange when they want it (usually with 28 days), and unless demand is very low, then they will just put it back up for sale if you don't agree with what they want...

Jamesdobo

Hi, 

Thanks for your response

Can you explain this further please? Exchange when they want what?
. Seashell517 said:

If you're using HTB, then the property is the new build? If so, the builders will want exchange when they want it (usually with 28 days), and unless demand is very low, then they will just put it back up for sale if you don't agree with what they want...

Thanks

MWT

Jamesdobo said:

Can you explain this further please? Exchange when they want what?.

The builders will be in the driving seat as long as demand for the property is good.

In short, they will tell you when Exchange will take place and you have the choice of agreeing or losing the property...

If demand is poor then there may be some scope for negotiation.

Jamesdobo

Thanks for clarifying MWT.

I don't feel comfortable exchanging before completion due to the possibility of offer withdrawal. So in this instance will be willing to loose the property rather than risk a 30k deposit. 
Do you think these fears are irrational? 
Thanks

MWT

What grounds do you think there could be for the mortgage offer to be withdrawn?

Generally lenders want to lend money so they can make money, so offers are not usually withdrawn without good reason.

In current circumstances I guess the biggest risk is your current employment status.

Do you have any reason to believe that you are likely to be furloughed or made redundant for example?

Some builders are allowing Covid related break clauses in contracts, may be worth seeing if yours will do that if this is your main concern.

Amy32

Jamesdobo said:

Hi Everyone, 
I have seen various posts which suggest same day exchange and completion is risky. 
For my situation, i cant help but think it is the least risky option, so much so i am hesitant to go ahead with the transaction unless exchange and completion happens on the same day. 

I am a first time buyer, hoping to purchase a property using HTB. The reasons for me wanting to exchange and complete on the same day is to negate any  risk of the mortgage being withdrawn after exchange. The property in question is vacant, and i am currently living with parents so no issues with regard to chains. 

Is there anything else i am missing with regards to the 'Cons' of exchanging and completing on the same day. 

Your responses are much appreciated. 

Many thanks.

We are currently buying a new build with help to buy and have been told that we can’t exchange and complete on same day as help to buy need 5 working days for transfer of funds. I am with you though, I would of preferred it and am very nervous for the time between exchange and completion. 

Jamesdobo

My main concern arises from reading story's of this happening, some of which had no reason to be withdrawn. 

I am self employed, potentially changing the way i work in April due to IR35 so this is a possible reason. I will not be out of work, however there is potential for the way I am paid to change. 

I just dont see why anyone would favour a period of time between exchange and completion if there is no chain. Although the possibility of withdrawal after exchange is low, the consequences are life changing. 

Amy32

Jamesdobo said:

My main concern arises from reading story's of this happening, some of which had no reason to be withdrawn. 

I am self employed, potentially changing the way i work in April due to IR35 so this is a possible reason. I will not be out of work, however there is potential for the way I am paid to change. 

I just dont see why anyone would favour a period of time between exchange and completion if there is no chain. Although the possibility of withdrawal after exchange is low, the consequences are life changing. 

I know exactly what you mean, and I feel the same but I guess we are restrained by the help to buy logistics. 

Jamesdobo

@Amy32 I am quite surprised this is even a possibility to be honest. Like I said previously, as unlikely as it may be the consequences are awful. 

Jamesdobo

@Amy32 So were you told that there is a minimum 5 days required for the release of the equity loan? If it was just between you, the lender and the buyer it would be possible?