Am I worried for nothing? Exchanging 3 months prior to completion.Stressing out

Flugelhorn

our vendors wanted completion  8 weeks after exchange last year - we weren't wild about it but went with it - we exchanged early March and by the time the 8 weeks was up we were mid lockdown, really wish we had been able to complete earlier as the lockdown led to more hassle. 
Solicitor added to contract that the vendors had to insure the property after exchange as we were nor able to do so as not living there.

TheJP

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

Continental said:

I wouldn’t exchange with a such a long time to completion.

You do realise that you would have to purchase buildings insurance at exchange? Anything major going wrong with the house would then be *your* responsibility.

The sellers should go into rented/AirBnB or stay with relatives if they are so desperate to exchange with a long lead time......with a shortage of building materials who is to say it the vendors new build will even be ready? It might not be ready until after Easter or early Summer!

I doubt they will put it (the house you are trying to buy) back on the market as there is no way they will be able to exchange quickly. 

There will be other mortgages available.....I wouldn’t let them bully you into exchanging right now. Indeed there will be plenty of other properties available in the New Year. 

Crazy talk. Just because you exchange doesn't mean you would be liable for anything that goes wrong with the house. I also doubt the vendors will cancel their own cover if exchange happens considering they don't have to insure a new build until completion as that's covered by the developers.

You could ask for a mortgage extension, many lenders offer 3-6 months based on the situation. I would probably stipulate that you would only exchange if there was a clause that the sellers move out even if their property is yet not ready. 

Liability between exchange and completion is not that clear cut. You still have to proceed with completion if the house burns down after exchange so it's wise to have insurance in place. Many lenders insist on insurance being in place from exchange. I had to send my solicitor my policy details before she would proceed with exchange. 

ETA: from citizens advice

https://www.citizensadvice.org.uk/housing/moving-and-improving-your-home/problems-with-buying-and-selling-a-home/#h-problems-with-the-property

A house may be damaged after contracts have been exchanged but before the sale is completed, for example, a burst pipe or a broken window. It is the seller’s responsibility to inform the buyer of any damage. It is however the buyer’s responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out. The buyer will then have to make a claim on their insurance policy.

Simple fix, add it to the contract that the seller will insure the property and be liable for any repairs if anything should break. There is no legal stipulation that you are liable for anything that happens to the house after exchange, the sellers are still the legal owners. lenders want you to insure it asap as their capital is at risk. 

The lender may not release the mortgage unless the buyer has insurance in place so that "simple fix" may not be that simple, or even a fix. 

Also house insurance is in the range of like £100 to £200. Why take any risk for such a small amount of money? 

No lender i have used has definitively asked for insurance more of a recommendation. My comments were directed to the poster that stated if anything happened post exchange they would be liable. Which is not true.

user1977 said:

MaryNB said:

user1977 said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

Continental said:

I wouldn’t exchange with a such a long time to completion.

You do realise that you would have to purchase buildings insurance at exchange? Anything major going wrong with the house would then be *your* responsibility.

The sellers should go into rented/AirBnB or stay with relatives if they are so desperate to exchange with a long lead time......with a shortage of building materials who is to say it the vendors new build will even be ready? It might not be ready until after Easter or early Summer!

I doubt they will put it (the house you are trying to buy) back on the market as there is no way they will be able to exchange quickly. 

There will be other mortgages available.....I wouldn’t let them bully you into exchanging right now. Indeed there will be plenty of other properties available in the New Year. 

Crazy talk. Just because you exchange doesn't mean you would be liable for anything that goes wrong with the house. I also doubt the vendors will cancel their own cover if exchange happens considering they don't have to insure a new build until completion as that's covered by the developers.

You could ask for a mortgage extension, many lenders offer 3-6 months based on the situation. I would probably stipulate that you would only exchange if there was a clause that the sellers move out even if their property is yet not ready. 

Liability between exchange and completion is not that clear cut. You still have to proceed with completion if the house burns down after exchange so it's wise to have insurance in place. Many lenders insist on insurance being in place from exchange. I had to send my solicitor my policy details before she would proceed with exchange. 

ETA: from citizens advice

https://www.citizensadvice.org.uk/housing/moving-and-improving-your-home/problems-with-buying-and-selling-a-home/#h-problems-with-the-property

A house may be damaged after contracts have been exchanged but before the sale is completed, for example, a burst pipe or a broken window. It is the seller’s responsibility to inform the buyer of any damage. It is however the buyer’s responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out. The buyer will then have to make a claim on their insurance policy.

Simple fix, add it to the contract that the seller will insure the property and be liable for any repairs if anything should break. There is no legal stipulation that you are liable for anything that happens to the house after exchange, the sellers are still the legal owners. lenders want you to insure it asap as their capital is at risk. 

The lender may not release the mortgage unless the buyer has insurance in place so that "simple fix" may not be that simple, or even a fix. 

Lenders only require insurance to be in place at completion. What happens between exchange and completion isn't their concern.

No, many require it at exchange. I have a mortgage with Halifax and they required it be in place before I exchanged.

https://www.halifax.co.uk/mortgages/help-and-advice/exchange-of-contracts-explained.html
You will need to arrange buildings insurance for your new home before the exchange of contracts

That's just a page with a Ladybird guide to buyers about the normal procedures generally, it's not actually a requirement of the lender that you insure from exchange.

This is what the UK Lenders Handbook (the standard solicitors instructions) say about it:

"6.14 Insurance

6.14.1 You must make reasonable enquiries to satisfy yourself that buildings insurance has been arranged for the property from no later than completion.

You should remind the borrower that they:

• Must have buildings insurance in accordance with the requirements of the mortgage contract no later than completion, and
• Must maintain such buildings insurance throughout the mortgage term."

I've already quote Halifax above. It's a requirement of theirs and my solicitor checked that I had it before I exchange. I didn't say all lenders, I said some. HSBC says most require it.

HSBC Insurance

It’s not a legal requirement, but most mortgage lenders insist that you to have buildings insurance in place when you exchange contracts. This is when you legally own the property and are responsible for the building. 

HSBC Mortgages

Your solicitor or licensed conveyancer will exchange contracts with the seller’s conveyancer, and you’ll hand over your deposit for the house. The agreement is now legally binding, and you’ll need buildings insurance in place at this point. 

Nationwide
Remember, you'll need to arrange for buildings insurance on your new home before you can exchange contracts.

Santander
If you’re moving home, when you’re happy with the contract and you’ve signed it, your solicitor or licensed conveyancer will ‘exchange’ your contract with the seller’s solicitor - this is then legally binding. The solicitors will then agree a completion date. At this point, you’ll also need home insurance. Buildings insurance is a requirement of your mortgage and is essential to protect you against damage caused by things like fire and flooding etc

Natwest

When you exchange, you'll sign a contract that legally commits you to buying the property. You'll need to pay your deposit, the signed contract will be exchanged with the seller's solicitor or conveyancer, and the two side will agree a date to complete the sale.

At this point your solicitor or conveyancer will have carried out all necessary land searches. You'll need to have buildings insurance in place too, in case something happens to the property before you move in.

RBS

Once your offer has been accepted, your solicitor and the seller's solicitor will deal with the formal process of transferring title and firming up the deal, known as concluding missives. Once this has happened you'll be formally bound to purchasing the property.

At this point your solicitor or conveyancer will have carried out all necessary land searches. You'll need to have buildings insurance in place too, in case something happens to the property before you move in.

Barclays is the only one of the major lenders I checked that requires it at completion

Your mortgage adviser will have already spoken to you about arranging buildings, content and life insurance – your buildings cover needs to start on your completion date. If you haven’t already arranged home contents and life insurance, you should consider that now. 

No chance that i would insure a property for 3 months for any Tom, D and Harry to live in and to do what they want and say haha your liable for this damage. Its guidance not a legal requirement and not regulated. Never have i had to provide evidence of insurance just a note from the solicitor to say its my responsibility. I've only insured when its a day or so before completion. Simple fix is to add it to the contract that the house is insured by the vendors until completion.

aoleks

th seller is asking you something unreasonable, which is to exchange a huge amount of time before completion. all the risk is now on you and trust me, many thing can go wrong. say you'll agree on one condition: should the (same) bank not honour your mortgage offer in 3 months time, you will be allowed to rescind without losing your deposit.

otheriwse just wait and exchange a few days before, when there's more clarity.

TheJP

Lets put this into perspective here, Buyer insures the property 3 months before completion, seller still has house insurance. Seller has a bad gas connection and house explodes bringing the house down. Who is liable?

Some posters here seem to think the buyer who has not yet completed would be liable! Madness. They also wouldn't lose their deposit because the seller would be the one that would fail to complete.

Insurance at exchange is just a safeguard not a liability, yes if its a week or a couple of days then no harm, but 3 months then that's on the sellers to protect and pay.

cramsteems

aoleks said:

th seller is asking you something unreasonable, which is to exchange a huge amount of time before completion. all the risk is now on you and trust me, many thing can go wrong. say you'll agree on one condition: should the (same) bank not honour your mortgage offer in 3 months time, you will be allowed to rescind without losing your deposit.

otheriwse just wait and exchange a few days before, when there's more clarity.

We tried that, they will not allow us to add a clause like that in.

If we don’t exchange the new build company will force the sellers to pull out of the sale and look for another buyer.

We are at the total mercy of the new build seller who has total control and zero liability should anything happen. In fact they would gain the sellers deposit if something stopped it going through and they would be very happy about that!

TheJP

cramsteems said:

aoleks said:

th seller is asking you something unreasonable, which is to exchange a huge amount of time before completion. all the risk is now on you and trust me, many thing can go wrong. say you'll agree on one condition: should the (same) bank not honour your mortgage offer in 3 months time, you will be allowed to rescind without losing your deposit.

otheriwse just wait and exchange a few days before, when there's more clarity.

We tried that, they will not allow us to add a clause like that in.

If we don’t exchange the new build company will force the sellers to pull out of the sale and look for another buyer.

We are at the total mercy of the new build seller who has total control and zero liability should anything happen. In fact they would gain the sellers deposit if something stopped it going through and they would be very happy about that!

You are at the mercy of your sellers. You could always ask them to exchange and complete now or you pull out. They can go rent/stay with family its all their choice and control. The developer can only complete when the house is ready. Your sellers can move out at any time.

MaryNB

TheJP said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

Continental said:

I wouldn’t exchange with a such a long time to completion.

You do realise that you would have to purchase buildings insurance at exchange? Anything major going wrong with the house would then be *your* responsibility.

The sellers should go into rented/AirBnB or stay with relatives if they are so desperate to exchange with a long lead time......with a shortage of building materials who is to say it the vendors new build will even be ready? It might not be ready until after Easter or early Summer!

I doubt they will put it (the house you are trying to buy) back on the market as there is no way they will be able to exchange quickly. 

There will be other mortgages available.....I wouldn’t let them bully you into exchanging right now. Indeed there will be plenty of other properties available in the New Year. 

Crazy talk. Just because you exchange doesn't mean you would be liable for anything that goes wrong with the house. I also doubt the vendors will cancel their own cover if exchange happens considering they don't have to insure a new build until completion as that's covered by the developers.

You could ask for a mortgage extension, many lenders offer 3-6 months based on the situation. I would probably stipulate that you would only exchange if there was a clause that the sellers move out even if their property is yet not ready. 

Liability between exchange and completion is not that clear cut. You still have to proceed with completion if the house burns down after exchange so it's wise to have insurance in place. Many lenders insist on insurance being in place from exchange. I had to send my solicitor my policy details before she would proceed with exchange. 

ETA: from citizens advice

https://www.citizensadvice.org.uk/housing/moving-and-improving-your-home/problems-with-buying-and-selling-a-home/#h-problems-with-the-property

A house may be damaged after contracts have been exchanged but before the sale is completed, for example, a burst pipe or a broken window. It is the seller’s responsibility to inform the buyer of any damage. It is however the buyer’s responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out. The buyer will then have to make a claim on their insurance policy.

Simple fix, add it to the contract that the seller will insure the property and be liable for any repairs if anything should break. There is no legal stipulation that you are liable for anything that happens to the house after exchange, the sellers are still the legal owners. lenders want you to insure it asap as their capital is at risk. 

The lender may not release the mortgage unless the buyer has insurance in place so that "simple fix" may not be that simple, or even a fix. 

Also house insurance is in the range of like £100 to £200. Why take any risk for such a small amount of money? 

No lender i have used has definitively asked for insurance more of a recommendation. My comments were directed to the poster that stated if anything happened post exchange they would be liable. Which is not true.

user1977 said:

MaryNB said:

user1977 said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

Continental said:

I wouldn’t exchange with a such a long time to completion.

You do realise that you would have to purchase buildings insurance at exchange? Anything major going wrong with the house would then be *your* responsibility.

The sellers should go into rented/AirBnB or stay with relatives if they are so desperate to exchange with a long lead time......with a shortage of building materials who is to say it the vendors new build will even be ready? It might not be ready until after Easter or early Summer!

I doubt they will put it (the house you are trying to buy) back on the market as there is no way they will be able to exchange quickly. 

There will be other mortgages available.....I wouldn’t let them bully you into exchanging right now. Indeed there will be plenty of other properties available in the New Year. 

Crazy talk. Just because you exchange doesn't mean you would be liable for anything that goes wrong with the house. I also doubt the vendors will cancel their own cover if exchange happens considering they don't have to insure a new build until completion as that's covered by the developers.

You could ask for a mortgage extension, many lenders offer 3-6 months based on the situation. I would probably stipulate that you would only exchange if there was a clause that the sellers move out even if their property is yet not ready. 

Liability between exchange and completion is not that clear cut. You still have to proceed with completion if the house burns down after exchange so it's wise to have insurance in place. Many lenders insist on insurance being in place from exchange. I had to send my solicitor my policy details before she would proceed with exchange. 

ETA: from citizens advice

https://www.citizensadvice.org.uk/housing/moving-and-improving-your-home/problems-with-buying-and-selling-a-home/#h-problems-with-the-property

A house may be damaged after contracts have been exchanged but before the sale is completed, for example, a burst pipe or a broken window. It is the seller’s responsibility to inform the buyer of any damage. It is however the buyer’s responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out. The buyer will then have to make a claim on their insurance policy.

Simple fix, add it to the contract that the seller will insure the property and be liable for any repairs if anything should break. There is no legal stipulation that you are liable for anything that happens to the house after exchange, the sellers are still the legal owners. lenders want you to insure it asap as their capital is at risk. 

The lender may not release the mortgage unless the buyer has insurance in place so that "simple fix" may not be that simple, or even a fix. 

Lenders only require insurance to be in place at completion. What happens between exchange and completion isn't their concern.

No, many require it at exchange. I have a mortgage with Halifax and they required it be in place before I exchanged.

https://www.halifax.co.uk/mortgages/help-and-advice/exchange-of-contracts-explained.html
You will need to arrange buildings insurance for your new home before the exchange of contracts

That's just a page with a Ladybird guide to buyers about the normal procedures generally, it's not actually a requirement of the lender that you insure from exchange.

This is what the UK Lenders Handbook (the standard solicitors instructions) say about it:

"6.14 Insurance

6.14.1 You must make reasonable enquiries to satisfy yourself that buildings insurance has been arranged for the property from no later than completion.

You should remind the borrower that they:

• Must have buildings insurance in accordance with the requirements of the mortgage contract no later than completion, and
• Must maintain such buildings insurance throughout the mortgage term."

I've already quote Halifax above. It's a requirement of theirs and my solicitor checked that I had it before I exchange. I didn't say all lenders, I said some. HSBC says most require it.

HSBC Insurance

It’s not a legal requirement, but most mortgage lenders insist that you to have buildings insurance in place when you exchange contracts. This is when you legally own the property and are responsible for the building. 

HSBC Mortgages

Your solicitor or licensed conveyancer will exchange contracts with the seller’s conveyancer, and you’ll hand over your deposit for the house. The agreement is now legally binding, and you’ll need buildings insurance in place at this point. 

Nationwide
Remember, you'll need to arrange for buildings insurance on your new home before you can exchange contracts.

Santander
If you’re moving home, when you’re happy with the contract and you’ve signed it, your solicitor or licensed conveyancer will ‘exchange’ your contract with the seller’s solicitor - this is then legally binding. The solicitors will then agree a completion date. At this point, you’ll also need home insurance. Buildings insurance is a requirement of your mortgage and is essential to protect you against damage caused by things like fire and flooding etc

Natwest

When you exchange, you'll sign a contract that legally commits you to buying the property. You'll need to pay your deposit, the signed contract will be exchanged with the seller's solicitor or conveyancer, and the two side will agree a date to complete the sale.

At this point your solicitor or conveyancer will have carried out all necessary land searches. You'll need to have buildings insurance in place too, in case something happens to the property before you move in.

RBS

Once your offer has been accepted, your solicitor and the seller's solicitor will deal with the formal process of transferring title and firming up the deal, known as concluding missives. Once this has happened you'll be formally bound to purchasing the property.

At this point your solicitor or conveyancer will have carried out all necessary land searches. You'll need to have buildings insurance in place too, in case something happens to the property before you move in.

Barclays is the only one of the major lenders I checked that requires it at completion

Your mortgage adviser will have already spoken to you about arranging buildings, content and life insurance – your buildings cover needs to start on your completion date. If you haven’t already arranged home contents and life insurance, you should consider that now. 

No chance that i would insure a property for 3 months for any Tom, D and Harry to live in and to do what they want and say haha your liable for this damage. Its guidance not a legal requirement and not regulated. Never have i had to provide evidence of insurance just a note from the solicitor to say its my responsibility. I've only insured when its a day or so before completion. Simple fix is to add it to the contract that the house is insured by the vendors until completion.

It's not that simple it's a grey area. Also since when does getting insurance makes you automatically liable for anything that could happen? If a lender requires insurance before exchange your solution doesn't remove that requirement. Also I never said it was a legal requirement. It's required by some lenders as part of their agreement to lend you a 6 figure sum. It doesnt have to be part of law for them to make it part of their requirement. For Halifax (my mortgage lender) it is their requirement, it wasn't just guidance. I never said everybody had to get insurance by exchange. But I did, as do many others and my solicitor required proof before exchange.

Average cost of house insurance is about £160. Paying 3 months early is say an £40 overpayment. Is that £40 really worth kicking up a fuss for something that's worth 6 figures?

TheJP said:

Lets put this into perspective here, Buyer insures the property 3 months before completion, seller still has house insurance. Seller has a bad gas connection and house explodes bringing the house down. Who is liable?

Some posters here seem to think the buyer who has not yet completed would be liable! Madness. They also wouldn't lose their deposit because the seller would be the one that would fail to complete.

Insurance at exchange is just a safeguard not a liability, yes if its a week or a couple of days then no harm, but 3 months then that's on the sellers to protect and pay.

‘We face a £50,000 bill for a flood – but we didn’t own the house’

In your scenario the buyer would lose their deposit if the house exploded and they didn't complete because they are still legally bound to complete, even if the house is substantially damaged.

SpiderLegs

cramsteems said:

aoleks said:

th seller is asking you something unreasonable, which is to exchange a huge amount of time before completion. all the risk is now on you and trust me, many thing can go wrong. say you'll agree on one condition: should the (same) bank not honour your mortgage offer in 3 months time, you will be allowed to rescind without losing your deposit.

otheriwse just wait and exchange a few days before, when there's more clarity.

We tried that, they will not allow us to add a clause like that in.

If we don’t exchange the new build company will force the sellers to pull out of the sale and look for another buyer.

We are at the total mercy of the new build seller who has total control and zero liability should anything happen. In fact they would gain the sellers deposit if something stopped it going through and they would be very happy about that!

You are absolutely not at the mercy of the new build seller. You are however letting them and your vendor pass their issues down the chain and onto you.

This is the vendor’s problem not yours. 

Thrugelmir

user1977 said:

Thrugelmir said:

user1977 said:

MaryNB said:

user1977 said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

Continental said:

I wouldn’t exchange with a such a long time to completion.

You do realise that you would have to purchase buildings insurance at exchange? Anything major going wrong with the house would then be *your* responsibility.

The sellers should go into rented/AirBnB or stay with relatives if they are so desperate to exchange with a long lead time......with a shortage of building materials who is to say it the vendors new build will even be ready? It might not be ready until after Easter or early Summer!

I doubt they will put it (the house you are trying to buy) back on the market as there is no way they will be able to exchange quickly. 

There will be other mortgages available.....I wouldn’t let them bully you into exchanging right now. Indeed there will be plenty of other properties available in the New Year. 

Crazy talk. Just because you exchange doesn't mean you would be liable for anything that goes wrong with the house. I also doubt the vendors will cancel their own cover if exchange happens considering they don't have to insure a new build until completion as that's covered by the developers.

You could ask for a mortgage extension, many lenders offer 3-6 months based on the situation. I would probably stipulate that you would only exchange if there was a clause that the sellers move out even if their property is yet not ready. 

Liability between exchange and completion is not that clear cut. You still have to proceed with completion if the house burns down after exchange so it's wise to have insurance in place. Many lenders insist on insurance being in place from exchange. I had to send my solicitor my policy details before she would proceed with exchange. 

ETA: from citizens advice

https://www.citizensadvice.org.uk/housing/moving-and-improving-your-home/problems-with-buying-and-selling-a-home/#h-problems-with-the-property

A house may be damaged after contracts have been exchanged but before the sale is completed, for example, a burst pipe or a broken window. It is the seller’s responsibility to inform the buyer of any damage. It is however the buyer’s responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out. The buyer will then have to make a claim on their insurance policy.

Simple fix, add it to the contract that the seller will insure the property and be liable for any repairs if anything should break. There is no legal stipulation that you are liable for anything that happens to the house after exchange, the sellers are still the legal owners. lenders want you to insure it asap as their capital is at risk. 

The lender may not release the mortgage unless the buyer has insurance in place so that "simple fix" may not be that simple, or even a fix. 

Lenders only require insurance to be in place at completion. What happens between exchange and completion isn't their concern.

No, many require it at exchange. I have a mortgage with Halifax and they required it be in place before I exchanged.

https://www.halifax.co.uk/mortgages/help-and-advice/exchange-of-contracts-explained.html
You will need to arrange buildings insurance for your new home before the exchange of contracts

That's just a page with a Ladybird guide to buyers about the normal procedures generally, it's not actually a requirement of the lender that you insure from exchange.

This is what the UK Lenders Handbook (the standard solicitors instructions) say about it:

"6.14 Insurance

6.14.1 You must make reasonable enquiries to satisfy yourself that buildings insurance has been arranged for the property from no later than completion.

You should remind the borrower that they:

• Must have buildings insurance in accordance with the requirements of the mortgage contract no later than completion, and
• Must maintain such buildings insurance throughout the mortgage term."

As far as the borrower is concerned. The over riding requirement will be the terms and conditions contained in the mortgage offer document. Not the UK lenders handbook. 

So find us a mortgage offer which requires it. And/or explain why the lender would care, given they're not a party to the contract. They obviously don't care enough to bother instructing the solicitors to check insurance is in place at exchange.

That's simply being obtuse and not approaching the matter in a reasoned and sensible manner. Ultimately all financial transactions are based on a degree of trust. The greater risk and loss lies with the purchaser. The lender can build losses into their mortgage pricing policy. 

FTB2021HELP

user1977 said:

Thrugelmir said:

user1977 said:

MaryNB said:

user1977 said:

MaryNB said:

TheJP said:

MaryNB said:

TheJP said:

Continental said:

I wouldn’t exchange with a such a long time to completion.

You do realise that you would have to purchase buildings insurance at exchange? Anything major going wrong with the house would then be *your* responsibility.

The sellers should go into rented/AirBnB or stay with relatives if they are so desperate to exchange with a long lead time......with a shortage of building materials who is to say it the vendors new build will even be ready? It might not be ready until after Easter or early Summer!

I doubt they will put it (the house you are trying to buy) back on the market as there is no way they will be able to exchange quickly. 

There will be other mortgages available.....I wouldn’t let them bully you into exchanging right now. Indeed there will be plenty of other properties available in the New Year. 

Crazy talk. Just because you exchange doesn't mean you would be liable for anything that goes wrong with the house. I also doubt the vendors will cancel their own cover if exchange happens considering they don't have to insure a new build until completion as that's covered by the developers.

You could ask for a mortgage extension, many lenders offer 3-6 months based on the situation. I would probably stipulate that you would only exchange if there was a clause that the sellers move out even if their property is yet not ready. 

Liability between exchange and completion is not that clear cut. You still have to proceed with completion if the house burns down after exchange so it's wise to have insurance in place. Many lenders insist on insurance being in place from exchange. I had to send my solicitor my policy details before she would proceed with exchange. 

ETA: from citizens advice

https://www.citizensadvice.org.uk/housing/moving-and-improving-your-home/problems-with-buying-and-selling-a-home/#h-problems-with-the-property

A house may be damaged after contracts have been exchanged but before the sale is completed, for example, a burst pipe or a broken window. It is the seller’s responsibility to inform the buyer of any damage. It is however the buyer’s responsibility to insure the property from the date of exchange of contracts and to have the repairs carried out. The buyer will then have to make a claim on their insurance policy.

Simple fix, add it to the contract that the seller will insure the property and be liable for any repairs if anything should break. There is no legal stipulation that you are liable for anything that happens to the house after exchange, the sellers are still the legal owners. lenders want you to insure it asap as their capital is at risk. 

The lender may not release the mortgage unless the buyer has insurance in place so that "simple fix" may not be that simple, or even a fix. 

Lenders only require insurance to be in place at completion. What happens between exchange and completion isn't their concern.

No, many require it at exchange. I have a mortgage with Halifax and they required it be in place before I exchanged.

https://www.halifax.co.uk/mortgages/help-and-advice/exchange-of-contracts-explained.html
You will need to arrange buildings insurance for your new home before the exchange of contracts

That's just a page with a Ladybird guide to buyers about the normal procedures generally, it's not actually a requirement of the lender that you insure from exchange.

This is what the UK Lenders Handbook (the standard solicitors instructions) say about it:

"6.14 Insurance

6.14.1 You must make reasonable enquiries to satisfy yourself that buildings insurance has been arranged for the property from no later than completion.

You should remind the borrower that they:

• Must have buildings insurance in accordance with the requirements of the mortgage contract no later than completion, and
• Must maintain such buildings insurance throughout the mortgage term."

As far as the borrower is concerned. The over riding requirement will be the terms and conditions contained in the mortgage offer document. Not the UK lenders handbook. 

So find us a mortgage offer which requires it. And/or explain why the lender would care, given they're not a party to the contract. They obviously don't care enough to bother instructing the solicitors to check insurance is in place at exchange.

My HSBC mortgage offer required insurance from exchange.