What is completion day?
In the buying and selling process, completion day is the last step. It's when ownership is transferred from the seller to the buyer, and the money is transferred between the parties. An exciting time for both the buyer and seller!
What happens on completion day?
On the build-up-to completion day, your conveyancer will confirm the transaction and deal with the paperwork and transfer deeds to ensure the completion will go ahead. For example, they will:
- Check all of the buyers’ mortgage conditions have been met. If the conveyancer is satisfied, they will request money from the lender.
- If you are the buyer, your conveyancer will request a Redemption Certificate (calculated to the day of completion) if there is a mortgage to sell.
- Create completion statements of all payments made and received for both the buyer and seller, depending on which side they are conveyancing for, and set out any invoices to be paid on completion.
- Both conveyancing solicitors will make final checks on completion day, and then the buyer’s solicitor will transfer the purchase money to the seller.
- The seller’s solicitor will then confirm receipt of the funds once they have been received, and the keys will be released from the estate agent.
- The buyer will then be notified of the completion, giving them the all-clear to move into the property.
When is completion day, and who decides when it takes place?
The seller and buyer usually agree on the date of completion in advance. Completion day normally occurs 7-14 days after the contracts have been exchanged. It typically takes place on a weekday, with the target move-out time between 12 and 2. This is because the money transfer and confirmation need to occur between the respective conveyancers, and the keys will need to be picked up from the estate agent.
Is it possible to complete and exchange on the same day? When you should and when you shouldn’t.
Although it isn’t advised, completing and exchanging on the same day is possible. The only problem is that you will not have a binding contract in place until the day that you are due to move in. The main risk is that the buyer or seller could pull out at any point up until the last minute, leaving you quite literally out in the cold.
Another risk is that you may end up wasting time and money hiring a removal van, taking meter readings and clearing rubbish, all of which could be delayed if the exchange doesn’t take place.
However, exchanging and completing on the same day does have some benefits as it speeds up the conveyancing process and means you don’t have to pay a deposit on the exchange of contracts.
Exchanging and completing on the same day tends to be more common amongst buy-to-let landlords or housing companies. This is because they do not need to move into the property on the same day as completion, or they are cash buyers who do not need to secure funding from a mortgage lender.
Is it possible to complete and move on different days?
The completion day is when the seller receives payment for the property and ownership is transferred and so they must move out by this date to allow the buyer to begin moving in.
If the buyer isn’t part of a chain and has no property to sell, they can move into the house either on or after the completion day. If the buyer is involved in a property chain, they may have to wait until the seller has also had their completion day.
What happens on completion day when buying a new build?
Due to the nature of purchasing a new build, a completion day isn’t possible. This is because of delays that may occur due to the house still being built. As a result, there can sometimes be an extended period between exchanging contracts and the completion date. What is typically a period of 7 to 14 days can be months when buying a new build property.
What are the differences on completion day between buying in a property chain and a property with no chain?
The completion process in a chain will usually start with someone who is only buying, for example, a first-time buyer, and end with someone who is only selling a property. The buyer's conveyancer will transfer the funds on completion day, and once the seller’s conveyancer has received the payment, completion has legally taken place. Once there is confirmation of the receipt of funds, the seller’s solicitor will contact the estate agent to authorise the release of the keys to the buyer. Both conveyancers will then call their respective clients to confirm the completion.
When buying a house with no chain, the completion day should be more straightforward as you won’t be reliant upon other transactions. Completion will normally take place around 11 am, as long as the buyer’s conveyancer has received all payments. Due to the seller not buying another house, the buyer shouldn’t have to wait as long to move in.
Transferring money. Will you be fined for not having the money needed for completion day?
The main event on completion day is the transferral of the final funds to the seller’s conveyancer.
First, the buyer will need to ensure they’ve paid all the required funds to their conveyancer, including the conveyancing costs. If they are purchasing a home with a mortgage, the mortgage funds must also be received by their conveyancer. Once all payments have been received, the buyer’s conveyancer will transfer the final funds.
There is a fine if the funds are not transferred on time on completion day. However, if the reason you have failed to pay is that your buyers failed to transfer the money, then they will pay a penalty to you.
How do I get the keys on completion day?
You will be able to collect the keys either from the estate agent or directly from the buyer once the seller’s solicitor has received the funds and confirmed it with the buyer.
What problems can arise?
- There could be a delay of funds: it is usually the case that the buyer will use a combination of their own funds and a mortgage. To be on the safe side, it’s best that the purchase funds are paid to the buyer’s conveyancer the day before the completion day.
- Bank deadlines could be missed: the funds will need to be transferred to the seller’s conveyancer’s bank account by 4 pm for completion. If the money hasn’t been transferred by 4 pm, the transaction will need to wait until the next working day.
- There’s a delay in the chain: it only takes one delayed payment in the chain to cause a delay to the whole chain.
How to make completion day run smoothly
- Plan ahead: once you know the completion date, make sure you have all of your household items packed up and your removal services booked in time. It’s a good idea to confirm expected times with the seller and the removals company to ensure everyone arrives at the right time to avoid chaos and leaving someone waiting.
- Communicate regularly: be easily contactable so that your conveyancer and estate agent can get in touch with you to confirm the completion. Regular contact with your conveyancer is also a good idea to resolve any issues that may arise.
- Have your funds and paperwork in order: all of your paperwork should be available in case you need to check anything prior to moving, and your funds should be ready to transfer to your solicitor.
How can instructing a conveyancer help?
A conveyancer will take care of all of the legal issues involved with the transaction. If you were to do this on your own, there could be issues that you are unsure of how to handle, which later affect the transaction or even your time living in the property.
A conveyancer will coordinate payments and liaison with all other contacts and ensure the legal process is carried out correctly. If there are any issues that need to be resolved or you have any questions, your conveyancer will be there to support you.