Exchange of contracts is the moment a property sale becomes legally binding. Here's how the process works, what you need to do before it happens, and what changes the instant contracts are exchanged.
Key Facts
Exchange of contracts is the formal legal step at which both the buyer's and seller's solicitors swap signed copies of the contract of sale. At this moment, the transaction becomes legally binding. The completion date is confirmed, and both parties are committed to completing the purchase.
Before exchange, either party can withdraw from the sale without legal obligation (though there may be costs). After exchange, withdrawing carries serious financial consequences—typically the loss of the buyer's deposit or damages claims against a withdrawing seller.
Exchange typically happens in week 10 of the conveyancing timeline—but this varies depending on the complexity of the transaction. It can only happen once three key milestones have been reached:
The buyer and seller have agreed a price (subject to contract), and the memorandum of sale has been issued.
The buyer's lender has issued a formal mortgage offer (not just an agreement in principle), and the solicitor has confirmed proof of the buyer's funds.
All local authority, drainage, environmental, and other required searches have come back and been reviewed by the buyer's solicitor.
⚠️ Don't Exchange Until You're Ready
Never agree to exchange under pressure if you're not fully satisfied with the searches, title, or your financial position. Once exchanged, you are legally committed. A short delay to resolve outstanding queries is always preferable to exchanging with unresolved doubts.
The exchange process is straightforward but must follow a specific procedure. In England and Wales, solicitors exchange contracts via a recorded telephone call using Law Society formula B (the standard method for most residential transactions). The process takes only a few hours:
| Step | What Happens | Who Does It |
|---|---|---|
| Deposit transferred | Buyer's solicitor receives 10% deposit from buyer | Buyer / buyer's solicitor |
| Contracts signed | Both buyer and seller sign their copy of the contract | Buyer and seller individually |
| Phone exchange | Solicitors agree by phone to exchange; each reads the contract aloud to confirm | Both solicitors |
| Contracts swapped | Signed contracts sent to the other party's solicitor (post or DX) | Both solicitors |
| Completion date confirmed | Agreed completion date is now legally locked in | Confirmed in the contract |
🛡️ Buildings insurance (buyer)
Your buildings insurance must start from the moment of exchange—you're now at risk for the property even before completion.
📦 Book removals
With a confirmed completion date, book your removal company immediately. Popular slots fill up fast—especially Fridays.
✉️ Notify utilities
Contact gas, electricity, water, broadband, and council tax to arrange account transfers for your completion date.
📬 Update your address
Notify banks, HMRC, DVLA, your employer, the GP surgery, and any subscriptions of your upcoming address change.
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