When buying or selling a property, neither side have any legal obligation to buy or sell the property until they exchange contracts. Before exchanging contracts both the seller and buyer can pull-out of the sale, the seller can accept multiple offer and buyers can gazump or be gazumped (see our gazumping page for more info).
What is the exchange of contacts?
The exchange is when both buyer and seller sign identical contracts and exchange them. (For example, if you’re selling, you’d sign the contract and send it to the buyers conveyancer/solicitor).
Once you’ve exchanged contracts there’s no going back, you’re legally bound. The seller must sell and buyer must buy.
When do I exchange contracts?
You should only exchange contracts once you’re 100% happy with the sale to go ahead. This is after you’ve negotiated the contract and agreed on a completion date.
When you’re ready to exchange you’ll have to set a date to exchange contracts with the other sides solicitors/conveyancers.
How do I exchange contracts?
This is usually done by the solicitors/conveyancers. They’ll verify that the contracts are identical via phone/email/fax and then exchange.
If you’re doing the conveyancing yourself, It’s unlikely that you will be allowed to exchange without legal help. Protocol requires undertakings to be given by legal professionals.
Can I exchange and complete on the same day?
Yes you can! But most mortgage lenders require a minimum number of days between exchanging and completing. This is just to make sure that there are no money transmission problems. That’s why this is more common in cash purchases.