Ready to Exchange? Here’s What To Expect…
Congratulations! You’ve successfully had the offer on your next home accepted, your property survey and searches are complete and all paperwork is in order. You’re ready to exchange!
But what exactly does it mean to ‘exchange’? And what can you expect from this final step onto the property ladder?
We know how frustrating waiting to exchange can be; finalising your purchase can feel like one long waiting game and this is the final hurdle for you to overcome. So to put your mind at ease, in this week’s article we’ll be taking a look at what you can expect when you’re exchanging.
It’s Time to Exchange – But What Does it All Mean?
First and foremost, you’re probably going to find exchanging contracts to be the least stressful stage of your buying journey. When it’s time to exchange, the entire process will be pretty much out of your hands and in the care of your solicitor. However, understanding this important and final stage will help to put any worries you do have to rest.
Your solicitor will write up a contract, ensuring that all information and technicalities regarding your purchase are accurate, covering everything from the purchase price to your property’s boundary lines. Most importantly for you, the contract will also state a date for when the sale will complete and you can officially call the property yours.
Before the exchange can take place, all terms set out in the contracts will have to be agreed by all parties. At which point contracts can be exchanged and both sides are legally bound to go ahead with the sale.
Whilst you will have relatively no involvement in the process of exchanging, it’s important to remember that by this point, you will have had to put down your deposit on the property. So ensure you have your funds ready.
Insurance – Do You Need It Yet?
If you’ve reached the point of exchanging contracts, then the answer is yes – you would be wise to invest in a good building and contents insurance, now.
This is because if there were to be problems with the property between exchanging and completion, you could still be considered responsible for the property and would be at risk of losing money. So play it safe and put your cover in place as soon as you can.
How Long Can You Expect to Wait?
If you’ve instructed a reliable solicitor early in the buying process and are not in a chain, then you can expect a quicker exchange and completion date. However no exchange is the same. Realistically, your exchange could take anything from a week to a couple of months.
But don’t be in too much of a rush to exchange at the expense of other important aspects of the buying process; you’ll want some time to get your property correctly surveyed and to ensure that you’re happy with the results of the property’s searches.
Change of Heart? Here’s What You Can Do…
Worried that you’ll exchange on your property and then change your mind? Backing out before completion isn’t recommended, as once you’re legally bound to buy the property, changing your mind can result in several financial penalties. However, if you really felt that you couldn’t go ahead with the purchase, there are things that can be done. For example, you may be able to apply for part of your deposit to be returned to you. This becomes easier if you put down a deposit exceeding 10%, as you may be able to reclaim any excess.
On the other hand, there are things you will have to consider should you fail to complete after a property has exchanged. These include legal costs, damages to the seller and any interest incurred.
But as we’ve already mentioned, should the worst happen and you do want to back out, the situation can be remedied. Just take extra care to consider everything before legally binding yourself to a purchase.
You’ve Exchanged – But Don’t Forget This Final Step!
You’ve exchanged and have your completion date. So now all that’s left to do is prepare to pick up the keys to your very own home!
But before you get settled in, remember to pay any final solicitor fees as well as your stamp duty fee. The amount you’ll be required to pay in stamp duty will depend on the price of your property, starting at 2% for properties worth £125,000-£250,000, 5% for £250,000-£925,000 and 10% for £925,000-£1.5 million.
Are you ready to exchange or has your search for a property only just begun?
Getting onto the property ladder and navigating the buying process can feel incredibly daunting, but with the right help it doesn’t have to be. Here at Amber Mortgages Southend we can offer you expert and friendly advice, as well as the most competitive mortgage and insurance rates around. For help with the purchase of your next property, why not contact us today?