How is a Completion Date Chosen?
When buying or selling a property, one of the most critical milestones in the process is deciding on the completion date. The completion date marks the day when the remaining balance for your property sale or purchase is transferred, and you collect the keys to your new home. But how is this date chosen, and what factors come into play?
Understanding the Completion Date
The completion date is the point at which the property transaction is legally finalised. On this day, the buyer’s solicitor transfers the outstanding funds to the seller’s solicitor. Once the seller’s solicitor confirms receipt of the funds, completion is confirmed. For buyers and sellers involved in a property chain, funds from a sale must often be received and transferred onwards to complete the related purchase. This creates a delicate sequence that must be carefully managed.
Factors Influencing the Completion Date
Choosing a completion date involves coordination and agreement among all parties in the chain, including buyers, sellers, and their solicitors. Communication is key, and estate agents often play a crucial role in mediating disputes or disagreements. Several factors influence the choice of a completion date:
- Mortgage Requirements: If buyers are using a mortgage, most lenders require at least five working days’ notice to release funds. This needs to be factored into the timeline when agreeing on a completion date.
- Time Between Exchange and Completion: In some cases, a specific period is needed between the exchange of contracts and completion. For example, sellers moving abroad or into rented accommodation may need additional time to finalise their arrangements.
- Rental Property Searches: If the seller plans to move into a rental property, they may require extra time to secure suitable accommodation after the sale of their home.
- Work Schedules and Personal Commitments: Buyers and sellers often consider their work schedules when choosing a completion date. For instance, someone working shifts may prefer not to complete on a Friday.
- Popular Moving Days: Fridays are a popular choice for completion as it gives buyers the weekend to unpack and settle in before returning to work. However, this preference can limit flexibility for others in the chain.
The Role of Solicitors in Setting a Completion Date
Once an offer is accepted, conveyancing solicitors or licensed conveyancers are instructed by both the buyer and seller. Their roles in the process include:
Seller’s Solicitor:
- Drafting the contract for the sale of the property.
- Responding to pre-contract enquiries.
- Providing proof of title (ownership).
- Setting out a schedule of inclusions in the sale.
- Proposing a completion date.
Buyer’s Solicitor:
- Ensuring the property title is sound.
- Reviewing the terms of the sale for legality and fairness.
- Securing funds from the buyer and the buyer’s mortgage lender.
Once all legal checks are completed, the mortgage offer is in place, and funds are secured, a completion date can be agreed upon. At this stage, the buyer pays the deposit, and contracts are exchanged. This exchange marks the legal point of no return.
Timing Between Exchange and Completion
It is common to have at least a week between exchanging contracts and the completion date. This allows time to arrange the transfer of utilities, book a moving company, and finalise other logistics. While exchanging and completing on the same day is possible, it carries risks. If the sale falls through before contracts are exchanged, you could face significant expenses, such as removal costs, without any legal recourse.
Exchanging contracts a couple of weeks before completion also provides legal protection. If either party fails to adhere to the contract terms, they can be sued or compelled to proceed with the sale as per the contract. Alternatively, damages may be sought. In such cases, the seller can retain the buyer’s deposit and remarket the property.
Choosing a completion date requires careful consideration of personal preferences, logistical needs, and the requirements of all parties involved. While Fridays are popular, flexibility and communication are essential, particularly for those in a chain. By working closely with your solicitor and maintaining clear communication with other parties, you can ensure a smoother completion process and a successful move into your new home.
Also consider public holidays such as Christmas – many banks, lenders and solicitors set a cut off date around the 18th December to ensure if there are any issues they can be resolved before many institutions close for the holidays.