What Can Go Wrong Between Exchange And Completion?

What Can Go Wrong Between Exchange And Completion?

What Can Go Wrong Between Exchange And Completion?

While most transactions complete smoothly, several issues can arise between exchange and completion. Stay organized, communicate clearly, and plan ahead to minimize risks.

Know your options if problems occur. With preparation and expert advice, you can navigate this tricky stage of the home buying/selling process.

Between the exchange and completion of a property transaction, several issues can arise that may delay or even cancel the transaction. Here are some potential problems:

  1. Chain Delays: Property transactions often involve a chain of buyers and sellers. If one person in the chain fails to complete their part of the transaction, it can have knock-on effects for everyone else in the chain, causing delays or even cancellations.
  2. Property Issues: Problems may arise with the property’s condition that were not disclosed by the seller or detected during the survey or inspection process. These issues can range from minor repairs to significant structural problems.
  3. Mortgage Withdrawals: The buyer’s mortgage offer could be withdrawn, which would prevent the transaction from completing.
  4. Legal Disputes: Legal issues and disputes can also arise between exchange and completion. For example, there may be outstanding legal disputes or issues with the property title.
  5. Removals Problems: The logistics of moving belongings from one property to another can cause delays, especially if there are issues with the removals company.
  6. Job Loss or Redundancy: If the buyer loses their job or is made redundant, this could affect their ability to secure the necessary financing to complete the transaction.
  7. Disputes with the Seller: Problems can arise if important information was concealed or questions were not answered correctly before contracts were exchanged. Disagreements over the purchase price can also obstruct completion.
  8. Problems on Completion Day: There might be a delay in the transfer of payment, or the seller may remove fixtures and fittings from the property that the buyer expected to be part of the deal

To mitigate these risks, it is essential to work with a qualified solicitor, conveyancer, and real estate agent who can help identify and resolve potential issues before they become significant problems.

It’s also important to communicate effectively with all parties involved and respond promptly to any queries or issues that arise

Preventing Issues

There are several things buyers and sellers can do to minimize issues:

  • Choose experienced solicitors and conveyancers.
  • Respond to queries promptly.
  • Keep all parties updated on progress.
  • Organize insurance, removals, and finances early.
  • Allow 1-2 weeks between exchange and completion.
  • Review all terms thoroughly before exchanging.
  • Declare any issues as soon as they arise.
  • Have contingency plans in place.

Dealing With Problems

If any problems do occur, speak to your solicitor immediately for advice. Be proactive in resolving disputes through negotiation. Be prepared for delays and have backup plans for completion. Understand your legal rights and responsibilities.

What is Simultaneous Exchange And Completion?

A simultaneous exchange and completion is where the exchange of contracts and completion happen on the same day. This means the buyer and seller both sign the contract and complete the sale on the same day, with no gap between exchange and completion.

Note that imultaneous exchange and completion can work well when the situation suits it, but it requires planning and carries some risks if things go wrong on the day. Most transactions have a gap between exchange and completion.

Some key points about simultaneous exchange and completion:

  • It removes the risk of one party pulling out between exchange and completion, as they happen together. However, there is still risk up until exchange.
  • It requires a high level of coordination and preparation by both parties to have everything ready for simultaneous exchange and completion.
  • It is more common when there is no property chain involved. Chains make it harder to coordinate simultaneous exchange and completion.
  • Cash buyers are more likely to be able to complete a simultaneous exchange and completion.
  • It removes the legally binding period between exchange and completion where parties are committed.
  • Problems that arise on completion day are harder to fix with a simultaneous exchange and completion.
  • It requires all searches and finances to be ready in advance.
  • Same day release of keys and funds takes place.

What Are The Risks Of Simultaneous Exchange And Completion?

The main risk is the lack of a buffer between exchange and completion to allow issues to be sorted out. This can lead to delays or the entire deal falling through if problems come up on the day.

Here are some of the main risks associated with simultaneous exchange and completion:

  • Fall through risk – There is no gap between exchange and completion to allow for problems to be fixed. If something goes wrong on the day, the whole transaction could fall through.
  • Timing risk – Trying to coordinate the timings of both exchange and completion on the same day is difficult. Even small delays could derail the simultaneous process.
  • Preparation risk – All preparations like surveys, mortgage, searches etc. need to be completed in advance. No time to sort issues.
  • Funds risk – The buyer won’t have time to transfer funds on the day so they need to be ready in advance.
  • Communication risk – Effective coordination is essential between both parties and their lawyers. Mix ups could occur.
  • Keys risk – Releasing keys before funds are received poses a risk to the seller.
  • No-go risk – If either party decides to pull out before exchanging, the deal collapses as exchange and completion happen together.
  • Dispute risk – Any disputes arising on the completion day are very hard to resolve with simultaneous exchange and completion.

Pros And Cons Of Simultaneous Exchange And Completion

The main pros are increased speed and removing gazundering risk. But the lack of a buffer between exchange and completion is the major downside if anything goes wrong on the day. It requires extensive planning and coordination between parties.

Here are some of the key pros and cons of simultaneous exchange and completion:

Pros Of Simultaneous Exchange And Completion:

  • Removes risk of gazundering or one party pulling out between exchange and completion.
  • Can speed up the conveyancing process as no gap is needed between exchange and completion.
  • Cash buyers often prefer simultaneous exchange and completion for speed.
  • Seller receives proceeds and buyer gets keys on the same day.
  • No need to arrange bridge finance between exchange and completion.

Cons Of Simultaneous Exchange And Completion:

  • High risk of deal falling through if any issues arise on the day.
  • Requires extensive preparation by both parties to have everything ready.
  • Harder to coordinate the timings and logistics.
  • No opportunity to fix problems between exchange and completion.
  • Risk of funds or keys being released before other side is ready.
  • More difficult when in a property chain.
  • Lenders may not agree to simultaneous exchange and completion.
  • Stressful having everything rely on one day.

When Is Simultaneous Exchange And Completion Used?

The main reasons for a simultaneous exchange and completion are:

  • To speed up the process when the property is vacant. The buyer can get the keys straight away.
  • In a chain-free transaction if both parties agree. This avoids delays and keeps things moving quickly.
  • When one or both parties requires a fast completion, e.g. needing funds from the sale urgently.


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