How Do I Exchange Contracts?

Whether you’re flying solo, purchasing as a couple or investing in a ‘forever’ family home, you’ll need to exchange contracts with the seller before you get the keys to your new property.

To help you settle into your new home as quickly as possible we’ve put together a guide covering everything you need to know about exchanging contracts.

Defining a contract exchange

In a nutshell, exchanging contracts locks both parties into a deal. Until contracts have been exchanged, neither the buyer or the seller has any legal obligation to go through with the property exchange. Without an official contract in place, either side can pull out of the agreement without any penalty or loss of deposit.

When does the contract exchange take place?

As a rule of thumb, contracts are usually exchanged between seven and 28 days prior to completion. That said, there’s no reason why contracts can’t be exchanged on the day of, though this eliminates room for flexibility when it comes to solving any issues that may arise at the eleventh hour.

Key points to consider

Exchanging contracts enters you into a legal indenture, which means you should make sure you’re 100% happy with the terms of the sale before signing. Key points to consider when entering a formal agreement include:

• Agreement on a final sale offer
• Clarity on whether the figure includes fixtures, fittings and other extras
• Successful completion of a mortgage valuation
• Results of any surveys you’ve had commissioned
• Receipt of a formal mortgage offer, in writing
• Confirmed funding for the mortgage deposit
• Building insurance that activates on the day contracts are exchanged
• An agreed date of completion for the final sale
• An in-depth understanding of the contract

Signing on the dotted line

Once you’re happy with the terms of your contract you’ll agree on a time and a date to exchange paperwork. If you’ve hired a solicitor you’ll sign the contract in advance, and they’ll take care of the physical exchange for you.

Exchanging contracts can be a headache, but with a positive attitude, an organised approach and an experienced solicitor on-side, you can make the process as smooth as possible.

Looking for a property? Visit Weale & Hitchen online

At Weale and Hitchen, we’ve been helping buyers find their forever homes for over 25 years. Established in 1990, our highly skilled professionals have impeccable knowledge of the local market.  Our online property search tool can help you search through hundreds of properties in the local area.

If you want to talk about your property requirements, pop into one of our local offices in Bury, Holcombe Brook, Harwood, Ramsbottom or Rawtenstall. Alternatively, you can fill in our online enquiry form and we’ll get back to you soon.