Exchange of contracts is when a property transaction becomes legally binding. Completion is when the transaction is finalised and the new owner gets the keys.
The difference between exchange and completion is something many buyers find confusing, and it's understandable, since both feel like significant milestones. But they are distinct legal events, usually separated by one to four weeks, and each carries its own financial and legal consequences.
Exchange of contracts
By the time exchange happens, a lot of groundwork has already been done. Once your offer has been accepted, your conveyancing solicitor will carry out all necessary conveyancing searches and review the title deeds. They will also raise and resolve any enquiries with the other side, and confirm your mortgage offer is in place.
Once everyone in the chain is ready, both buyer and seller sign their respective contracts. The solicitors then swap (or exchange) those signed contracts with each other. At the point of exchange, the sale becomes legally binding on both sides.
When exchanging contracts, a deposit is paid by the buyer, typically 10% of the purchase price, though this can sometimes be negotiated lower. Our guide to how much deposit you need as a first-time buyer covers this in more detail. The deposit is held by the seller's solicitor until the sale completes.
A completion date is also agreed at exchange. This is the date the transaction will finalise and the property will change hands.
What happens if someone pulls out after exchange?
Pulling out after exchange carries serious financial consequences. If the buyer withdraws, they lose their deposit. If the seller withdraws, the buyer can sue for the deposit amount plus any additional losses. In both cases, the party that pulls out may also be liable for the other side's legal costs.
This is why exchange is treated as the point of no return in a property transaction. Until exchange, either side can walk away with no legal penalty, though any costs already spent on surveys and solicitor work will be lost.
The period between exchange and completion
The gap between exchange and completion is typically one to four weeks, though it can be shorter or longer depending on what the parties agree at exchange. Our guide to how long conveyancing takes covers the full timeline in detail.
During this time your conveyancer will prepare the completion statement, which is a full breakdown of the funds needed on completion day, including the balance of the purchase price, Stamp Duty Land Tax (SDLT) and any other outstanding disbursements.
This is also the window to book your removals firm. Our first-time buyer moving checklist covers everything worth sorting in advance. Most people move on the day of completion itself, so booking early is worth doing as soon as your completion date is confirmed.
Completion
Completion is the final stage of the conveyancing process. On completion day, the balance of the purchase price is transferred from the buyer's solicitor to the seller's solicitor. Once the seller's solicitor confirms receipt of the funds, the seller must vacate the property and release the keys.
Your conveyancer will notify HM Land Registry of the change of ownership and register you as the new legal owner. If you are buying with someone else, you will also need to confirm how you are holding the property. Our guide to joint tenants vs tenants in common explains the difference.
Stamp Duty Land Tax (SDLT) is due within 14 days of completion. Your solicitor will handle the return and payment to HMRC on your behalf.
Keys are typically released via the estate agent. Once your solicitor confirms completion, you can collect them and get into your new home.
How long does completion take on the day?
Completion itself depends on how quickly funds move through the chain. In a straightforward transaction it can happen by late morning. In a long chain, it can take until mid to late afternoon if multiple transfers are waiting on each other. Your solicitor will keep you updated throughout the day.
Simultaneous exchange and completion
In some transactions, exchange and completion happen on the same day. This is most common in auction purchases and, in some cases, new build conveyancing where the developer sets the completion date.
The risk is higher, since there is no period of legal certainty between the two stages. If anything goes wrong on the day, both sides are exposed. It is relatively uncommon in standard residential transactions.
On moving day
When you leave your old property, take meter readings for gas, electricity and water and send them to your suppliers straight away. Do the same at the new property when you arrive. It avoids any dispute over bills at either address and takes a few minutes to sort.
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If you are approaching exchange and want to make sure the legal side is in safe hands, Homeward Legal works with a panel of regulated conveyancers who will start work as soon as you appoint them.
Every quote includes our no completion, no fee guarantee and a fixed legal fee, so you know exactly what you are paying before you commit. Get an instant quote online or speak to our friendly team on .
Frequently asked questions about exchange and completion
What is the difference between exchange and completion?
Exchange is when the contract is signed by both sides and becomes legally binding. Completion is when the money transfers and ownership changes hands. They are separate events, usually one to four weeks apart.
Can you pull out after exchange of contracts?
You can, but you will lose your deposit (if you are the buyer) or face a claim for damages (if you are the seller). Exchange legally binds both parties from that point, and there is no straightforward way out.
How long after exchange is completion?
The completion date is agreed at exchange. Most transactions complete one to four weeks after exchange, though this can vary depending on the chain and the parties' circumstances.
What happens on completion day?
The buyer's solicitor transfers the balance of the purchase price to the seller's solicitor. Once funds are confirmed, the seller releases the keys and the buyer can take possession of the property.
Do you pay stamp duty at exchange or completion?
Stamp Duty Land Tax (SDLT) is due at completion, not exchange. Your solicitor will submit the return and payment to HMRC within 14 days of the completion date.
What is simultaneous exchange and completion?
This is where both stages happen on the same day, with no gap between them. It is most common in auction purchases and carries more risk than a standard transaction where exchange and completion are separate events.
Can the completion date change after exchange?
The completion date is set at exchange and is part of the binding contract. Changing it after exchange requires agreement from all parties in the chain and is generally only done in exceptional circumstances.