Now that you’ve agreed an offer with the seller, the next goal is getting to Exchange. This is the part of the process that is the most riskiest to you as the buyer, as you sink in financial cost and make your most important decisions.
What are the steps to exchanging contracts?
There are 9 main steps to exchanging contracts, which is when your home purchase becomes final and legally binding.
1. You’ve agreed a price with the seller
2. The seller takes the property off the market and stop any further viewings
3. Get a mortgage in principle
4. Get a home survey done
5. Instruct a conveyancer
6. Get all the searches and paperwork through and inspect them
7. You agree a fixtures & fittings inventory
8. Get your cash for the mortgage deposit available
9. Send your deposit and signed paperwork back to your conveyancer
In this section of FTB.help, we have loads of articles and guides on the nine stages above, as well as a hundred other small considerations that you might have to deal with during the road to exchanging contracts.
The process is risky – there are so many things that could terminate your purchase. At any time the seller can pull out of the transaction, gazump you (where they accept a higher offer from someone else), try to re-negotiate on the price. The bank’s survey could come back lower than your agreed price. Your home survey might find some big issues with the property. The searches or title deeds might have a deal-breaker. The whole process might take months longer.
However, the process also has benefits for you as the buyer. In many other countries, you’re forced to put a deposit down right at the beginning, and there is a financial penalty to walking away. Here in the UK, if you find something that wasn’t to your expectations during the road to exchange, you can pull out at any time, without penalty. You can always re-negotiate the price; nothing is set in stone until after Exchange of Contracts.
Don’t rush through the steps to Exchanging Contracts. Sure, you don’t want it to take a year and frustrate the seller to the point where they pull out. But this is the last step in the process, before you legally have to make your most expensive ever purchase in your life, and take on probably the largest ever debt you will have, so make the most of this time to get all the information you need, ask all the questions you can, and make the best informed decision.
Ready for the next stage? Now go see our Guides & Tips for the Road to Exchange.