Solicitors, Exchange And Completion

Published on:

May 15, 2006

So you've made an offer on a property and it's been accepted. Now you'll need a solicitor to carry out the legal niceties. You're probably looking at about £500 to £1000 for these costs depending on the value of your house. If you are buying a leasehold property, such as a flat, then the fees may be slightly higher.

Conveyancing (the legal process of transferring ownership from the seller to the buyer) is actually pretty simple, as long as everything goes according to plan! Your solicitor will do most of the legwork and tell you what amounts you need to pay and when. They will also provide you with a 'balance sheet' of the whole transaction so you can see where all your money goes.

Before exchanging contracts

The seller's solicitor will draw up a contract for the transaction and ask the seller some basic questions e.g. what items are staying with the property. The contract and the seller's answers will then be sent to your solicitor, who will ask additional questions if they think any are necessary.

Your solicitor will check with the Land Registry that the seller of the property actually has the right to sell it. Searches will also be carried out to make sure the local authority doesn't have existing plans to run a motorway 200 yards from your shiny new front door. There will also be checks that any recent alterations that have been made to the property were permitted under planning regulations. (It's often this part of the process where hold-ups occur. If the business of buying and selling houses is booming, the Land Registry and local authorities get positively swamped with search enquiries and a backlog often builds up.)

These enquiries cost money because both the Land Registry and the local authority charge fees for providing such information and you should be aware that they'll probably appear as extras on your solicitor's bill in the form of 'disbursements' (lovely word, that). The deeds of the house also need to be checked to make sure that you've got proper rights of way and so on.

Your solicitor will then take you through the contract and the results from all the searches to make sure you are satisfied with what you are buying. You are then ready to exchange.

Exchanging contracts

Both you and the seller sign the contract. You also agree a completion date that suits both of you.

At this stage you also have to pay a deposit to the seller. Now pay attention, because this bit can get a little confusing! This deposit is not necessarily the same amount as the deposit you have agreed with your mortgage provider. That 'deposit' is the difference between the value of the property and the amount of your loan.

The deposit you pay to your seller is typically around 10% of the value of the property but there is room for negotiation to, say, 5% if you are a first-time buyer. Your solicitor will inform you how much you have to pay. You give your solicitor the money and they will pay it over on your behalf. The remaining balance is paid upon completion.

Until the exchange of contracts, the two parties are totally free to change their minds and to pull out of the deal -- but the moment contracts have been exchanged and you've handed over your deposit, both sides are legally required to proceed. If you don't, you risk being sued for breach of contract and you could lose your deposit.

Between exchange and completion

Your solicitor and the seller's solicitor will conduct the remaining legwork needed to complete the deal. Typically this will take about two weeks. You'll be asked to sign a few more documents and there'll be a bit of double-checking of the deeds and files. Your solicitor will tell you how much additional money you need to pay (if any) and collect the value of your loan from your mortgage provider.


Suddenly, it will be Completion Day! There will be a flurry of activity as the seller's solicitor accepts the mortgage money and sorts out who to give the keys to and at what time. (This entails urgent and exciting phone calls between the seller's solicitor and yours.) And then, at long last, you'll finally get the keys to your new home.


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