Exchanging Contracts
With your survey safely completed and the lender happy with it, you can move to the stage of getting a formal mortgage offer from your chosen lender which will detail all the conditions of the loan. Read this carefully and get your solicitor to explain anything you do not understand.
By this time, your solicitor should have a draft contract ready for you and the vendor to sign. Once you have signed this contract, there is no going back, so be very sure you are happy with all the sale arrangements before you commit yourself. Typically at exchange (unless exchange and completion are on the same day), you will have to put down a deposit of around 10% of the purchase price. You also need to make sure that the building is insured as you are now legally obliged to buy it (the lender or your solicitor will help make sure that this happens).
Check that:
- Your solicitor has completed all the local searches;
- The surveyor’s report is complete and accepted by all concerned;
- You have a formal mortgage offer in writing which you have read and understood;
- You have the agreed deposit available;
- You have agreed a firm completion date for the sale, and this date is noted in the contract;
- There are no outstanding issues remaining to be settled between you and the vendor. If, for example, there is any doubt whether or not the property’s existing carpets are to be included in the sale price, get the matter sorted out in writing before you sign the contract.
- When you have signed the contract, your solicitor will deliver it to the seller in exchange for the contract he has signed. From this point onward, both you and the seller are legally committed to the deal.
